Gross Profit Margin
Gross profit as percentage of revenue.
Formula
Gross Profit Margin = (Gross Profit / Revenue) × 100%
Real World
Primark consistently operates with lower gross profit margins than Burberry because its low-price model sacrifices margin for volume, while Burberry's luxury pricing protects margin.
Exam Focus
When asked to 'analyse', link the margin percentage to pricing strategy or production efficiency — don't just calculate it.
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