Help CenterWhat is Gross Profit?
Definition
Gross Profit = Net Sales – Product Cost
Gross Profit measures how much money your business makes after subtracting the cost of the products sold. It’s a key metric for understanding your brand’s profitability before operating expenses.
Why Gross Profit Matters
Gross Profit helps you determine how efficiently you're producing and selling products. A strong gross profit margin means more cash to reinvest in marketing, team growth, and new product development.
How to Improve Gross Profit
1. Reduce Discounting
Track which discount campaigns are heavily impacting net sales and adjust your promotional strategy to preserve margin.
2. Increase Pricing
Look for products or categories where you can raise prices without negatively affecting sales volume or conversion rates.
3. Focus on High-Margin Products
Double down on products with strong margins. Consider prioritising stock, marketing, and placement for these items.
4. Reduce Cost of Goods Sold (COGS)
Explore opportunities to lower product and freight costs. This can include:
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Renegotiating with suppliers
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Switching to more efficient packaging
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Optimising freight and logistics
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