▸Gross margin is 40.0% (a healthy margin).
- For every unit sold, you earn 40.00 in gross profit.
- Your markup is 66.7%, meaning you priced the product 66.7% above your cost.
- This margin gives meaningful room to absorb operating expenses (rent, wages, marketing) while remaining profitable.
Next stepTo reach net profit margin, subtract operating expenses, interest, and taxes from gross profit, then divide by revenue.