Description: Margin refers to the difference between the cost of a good or service and its selling price. This concept is fundamental in the financial and commercial realm, as it determines the profitability of a product or service. A high margin indicates that a company is generating a good amount of profit relative to its costs, while a low margin may signal profitability issues or an ineffective pricing strategy. There are different types of margins, such as gross margin, which is calculated by subtracting the cost of goods sold from total revenue, and net margin, which considers all operating expenses, taxes, and other costs. Margin management is crucial for a business’s sustainability, as it allows companies to assess their financial performance and make informed decisions about pricing, costs, and market strategies. In a competitive environment, optimizing margin can be key to maintaining a company’s viability and growth.
