The balance of income after deducting all costs and losses is profit, and profit divided by operating income is profit rate. Generally, the tax authorities estimate that the profit of an enterprise is 10%.
One: In general, the higher the gross profit margin, the better, because the higher the gross profit margin, the greater the total profit of the company. However, it should also be noted that the higher the gross profit margin, the higher the general tax will be, so some companies will take the initiative to reduce the gross profit margin to realize the corresponding benefits in order to avoid VAT. So the difference between high gross profit margin and low gross profit margin is mainly for companies, but most companies have high gross profit margin and only a few have low gross profit margin.
Two: A company's gross profit margin is an important basis for a company's operating profit. If a company wants to achieve operating profit, it must first have enough gross profit. Therefore, regardless of other factors, the higher the company's gross profit margin means that the company's total profit increases, and the increase in the company's gross profit margin also means that the competitiveness of the company's goods in the market is increasing, and its performance and benefits are rising. When we see such a company, we can make corresponding investments to gain its growth potential.
One: Gross profit is the difference between price and cost, net profit and taxes and expenses, and expenses are divided into marketing expenses and management expenses. Because different industries, such as daily chemical industry, are high-cost industries with extremely high gross profit, but expenses, especially marketing expenses, are spent, which is almost a cost.
Second, the gross profit margin can reflect the sustainable competitive advantage of enterprises to a certain extent. If an enterprise has a sustainable competitive advantage, its gross profit margin will be at a high level, and it can freely price its products or services, so that the sales price is much higher than the cost of its products or services. If the enterprise lacks sustainable competitive advantage, its gross profit margin will be at a low level, and the enterprise can only make meager profits by pricing according to the cost of products or services.
Three: classification method
By commodity category: gross profit margin of single commodity, gross profit margin of large commodity and gross profit margin of comprehensive commodity.
Sub-industry: gross profit margin of product sales of industrial enterprises, gross profit margin of commodity sales of commercial enterprises, gross profit margin of construction industry, gross profit margin of transportation industry, gross profit margin of tourism and catering service industry.
Sub-region: sales gross profit rate and project gross profit rate by project region.