| Profit Margins in Business. |
| Click on the blue button for a summary of information at the site |
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| Websites linked to from this page hopefully will provide information that will help companies in decisions for improving profit margins. |
| A Management Accounting Information Center article “Websites with Relevant Information on Profits and Returns” attempts to identify websites that might help management accountants who are analyzing profits and returns. Please click the home logo at the top left of this page to access this article. |
| Profit margin analysis. |
| Profit margin data. |
| The graph on the right was created using Google’s Chart Tools.
The graph is presented to show how gross profit margins can vary significantly according to the type of product sold. For example, gasoline products have a gross profit margin percentage in the 15 to 20 % range in recent years and women’s clothing in the 45 to 50 % range. The graph also shows that gross profit margin percentages usually do not vary much within a retail sector from year to year. For example, the heights of the bars for each type of retail product remain fairly constant from year to year. The US Census Bureau is the source of the graph’s data. Click here to go to a PDF file with the data. |
| The graph below was created using Google’s chart tool.
The horizontal bar graph shows the gross profit margin percentage for 11 business sectors. The data used to create the graph was taken from Internal Revenue Service statistics on form 1120s-filed corporate returns for 2008. This data can be viewed on the IRS report “2008 Statistics of Income – Corporation Income Tax Returns” by clicking here (PDF file). Business receipts were used for sales. The gross profit margin percentages were computed by subtracting the cost of goods sold reported on the 1120s from the business receipts and dividing that result by the business receipts. Data was used only for corporations reporting a positive net income. The percentages are for all size companies and all subsectors, so represent an approximate benchmark average that companies can use to compare their own gross profit margin percentages to somewhat similar companies. Subsectors exist for some of the sectors, so a more similar company comparison might be available. The graph indicates that for many sectors salaries and wages are not accounted for as cost of sales and therefore gross profit margin percentages are much higher than for those sectors where inventory sales is significant. |