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WordNet-Online
Definitions from WordNet
Noun profit-margin has 1 sense
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Definitions from the WebTerm: Profit MarginDescription:Profit margin refers to the percentage of profit a company earns from its revenue after deducting all expenses. It is a crucial metric that indicates the financial health and efficiency of a business. A higher profit margin signifies that a company is generating more profit per dollar of revenue. On the other hand, a lower profit margin may indicate lower profitability and the need for cost-cutting measures. Senses and Usages:1. Accounting:In accounting, profit margin is calculated by dividing net income by revenue and multiplying the result by 100. It shows the proportion of profit relative to the total revenue generated. Sample Sentence: The company's accounting team analyzed the profit margin to evaluate the overall financial performance. 2. Business Analysis:In business analysis, profit margin is used to compare the profitability of different companies or industries. It helps identify businesses with higher efficiency in converting revenue into profit. Sample Sentence: The investor considered the profit margin of various industries before making investment decisions. 3. Pricing Strategies:Profit margin plays a significant role in setting prices for products or services. Businesses need to ensure that the profit margin is sufficient to cover costs and generate a desired level of profit. Sample Sentence: The company adjusted the product prices to achieve a higher profit margin without compromising on quality. Related Products:Explore the following related products on Amazon: | ||||
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