the.com/profit margin
The percentage that separates a thriving business from an expensive hobby.
means The slice of revenue left over as profit after all costs are paid, usually expressed as a percentage of sales.
from 'Profit' traces back through French to Latin profectus, meaning 'progress' or 'advance' — the sense of material gain grew out of the idea of moving forward. 'Margin' comes from Latin margo, meaning edge or border, like the blank space at the side of a page. Put together in commercial English, the phrase pictures profit as the narrow edge left over at the boundary between what you earn and what you spend — the thin strip where a business actually gets ahead.
- formula
- net income divided by revenue, times 100
- grocery stores
- often run on 1-3 percent margins
- software companies
- can exceed 80 percent margins easily
- revenue vs profit
- high sales mean nothing if margin is zero