By Rich Bond
Solving business problems is largely based on taking what appear to be complex problems and addressing them in the simplest, most basic terms. Too many finance people take simple concepts and make them complicated. If you have a limited amount of time to devote to finance but want to grow profits, you should spend that time focusing on your gross margin, which is one of the most important, least utilized business indicators.
This article by Business News Daily’s Editor (What Should Your Profit Margins Be?) explains how managing your gross profit margin can have a huge impact on your bottom line. The article delves into gross and net profit margins and demonstrates shows how the combination of astute pricing, combined with a thorough understanding your cost of goods sold, will grow gross profit margin, better cover your overhead, and grow the bottom line and your net profit margin.
Let me know if you agree or disagree. I would be a happy to share other “tools” to help you more easily and effectively manage and grow profits.