Product Gross Margin

How much of sales revenue is left after costs?

Description

This metric shows for a given product how a large share of the revenues after deducting the Cost Of Goods Sold (COGS) is left for profit. Products with higher margins have a higher remaining percentage of sales for generating profits or covering other operating costs, such as overhead. Since the gross margin is the most critical driver of value created from scaling, this metric is beneficial for companies that are making a scalable product.

Motivation

Increased sales will impact profitability to a larger extent if your products have a high gross margin. If you want to maximize the value created from scaling, you should focus on keeping your gross margin high.

Trend chart

Metric Trend Chart

In the OKR goal-setting methodology, metrics are preferably used as part of a Key Result.

There are hundreds of metrics in the Agile Tools ever-growing library.