• Full guidance on profit margins

What's the profit margin?

Profit margins are the ratio of profit to cost or income. It is an important indicator of operational efficiency. The higher the Māori rate, the greater the profitability of commodities.

Main profit-rate type

Māori Rate: (Sale price-cost)/Sale price x 100%. Reflects the original profits of the commodity.
Net interest rate: Net profit/sale income x 100%. Reflects real profitability.
Cost rate: Cost/sale price x 100%. Reflects the share of costs in the sale price.

Industry reference profit margin

Retail trade: 15-30% (depending on commodity type)
Wholesale: 5-15% (blow-rate)
Manufacturing: 10-20% (industrial products)
Services: 20-40% (labour intensive)

How to optimize the profit margin

Reduce procurement costs and increase bargaining power
Improving product quality and supporting higher pricing
Improve operational efficiency and reduce operating costs
Market analysis, best pricing points.