profit margin

Definition

The ratio of net income to net sales of a company expressed as a percentage.

Example Sentences

• "If a company has $10,000 net income and $100,000 net sales, then the profit margin equals ($10,000 : $100,000) .10, or 10%."
• "A letter demanding payment costs her £75. A knock on the door from a company representative: another £235. Taking her car: an extra £110. Then there’s a daily storage charge, so that she pays £24 for every day she can’t drive. These were fees set by the government, using the industry’s sums. The result is that the firms chasing some of the poorest people in the country can rake in handsome profit margins."