Marginal profit is marginal contribution, which refers to the difference between sales revenue and variable cost. Unit gross profit refers to the difference between the selling price and the buying price, which is also gross profit. For example, the purchase price 100 yuan, the selling price 150 yuan, and the difference is 50% gross profit.
If you want to know the marginal gross profit, you have to know the variable cost, which refers to the part of the total amount that changes directly with the business volume.
Importance of gross profit margin
Importance of gross profit margin: Gross profit margin directly reflects the profitability of the company's core business and is the most basic and stable profit source of the company. However, the gross profit margin does not fully reflect the overall profitability of the company, because the company's profits may come from investment income, non-operating income and expenses. In addition to the main business, the gross profit margin level reflects the competitiveness of the company's main products.
When calculating the gross profit margin, only the production cost of the product is deducted from the operating income: the product cost is determined by the product characteristics, while the operating profit rate and net profit rate are affected by other factors such as the company's market influence, market discourse power and cost control ability. The more subjects involved, the greater the operating space. Therefore, compared with the operating profit rate and net profit rate, the gross profit rate is most suitable for comparison with companies in the same industry.
How to analyze gross profit margin: Gross profit margin will be affected by production and sales, product structure and so on. Some companies may affect the gross profit margin by operating product production and sales. For example, by increasing output and reducing the production cost per unit product, the operating cost in gross profit margin calculation will be reduced accordingly, thus improving the gross profit margin level. If the company manages diversified products, when the company increases the production and sales of high-margin products, it will increase the company's gross profit margin. The vertical analysis of gross profit margin can show the changes of the company's gross profit margin in 3-5 years and find out the specific reasons for the changes. It should be noted that when analyzing the company's gross profit margin alone, we can't simply judge the company's gross profit margin, and the gross profit margin must be compared within the industry before we can draw a conclusion.
It is necessary to analyze the gross profit margin horizontally, especially to compare it with the industry average, the company's direct competitors and industry leaders. If the company's products are diversified, the comprehensive gross profit margin should be diluted, and the gross profit margin of each product should be analyzed in detail by product.
Gross profit margin analysis should be combined with industry operating characteristics: because each industry has its operating characteristics, for some industries, operating costs can not accurately reflect the core input and output of industry production and operation, such as pharmaceutical industry, internet industry, expressway industry and so on. Generally speaking, the gross profit margin analysis is more suitable for traditional manufacturing industry.
Logical relationship between gross profit margin and other financial indicators: there is a logical relationship between gross profit margin itself, gross profit margin and inventory turnover rate, sales expense rate, cash conversion cycle and inventory impairment reserve, but this logical relationship is not accurate and may not be established at any time. If it is not established, it is necessary to explore the reasons, otherwise there is reason to doubt the authenticity of financial data.
What is the relationship between marginal gross profit and unit gross profit? Marginal gross profit is more a reflection of the difference generated by commodity sales revenue, which is more complicated, while unit gross profit is relatively simple. If the financial personnel are not sure, they can also fully understand it through the website.