Understanding your gross profit and how to improve it is critical to maximizing profitability. Gross Profit is sales less cost of goods sold and cost of goods sold are all of the costs directly related to your product or service.
My name is Michael Barbarita from Next Step CFO with the Know Your Numbers Minute.
Finding ways to increase your gross profit can have an exponential effect on profitability because your overhead expenses are basically fixed and don’t change much with increases in gross profit.
And remember, the most successful business owners know their numbers.