top of page
Gross Profit
Business
WHAT IS IT?
Gross profit is sales revenue minus the direct costs associated with those sales.
IN PLAIN ENGLISH
It is what is left from sales after the direct cost of making or delivering them.
SIMPLE EXAMPLE
Sell £10,000 of goods and incur £4,000 of direct costs: gross profit is £6,000 before other business costs.
WHY DOES IT MATTER
Gross profit helps show whether the underlying sales are generating enough contribution to cover overheads and produce a net profit.
THE ROCKET TEST
Gross profit is sales minus the direct costs of those sales.
SEE IT IN ACTION
READ MORE
bottom of page