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Net Profit Margin
What it measures
The percent of every dollar of income that ends up as profit after all costs and expenses.
Net Profit Margin % = (Net Profit ÷ Income) × 100Why it matters
Net Profit Margin is a signal that your operation as a whole is putting enough to the bottom line. Too high and you may not be investing enough into your business or yourself. Too low and you’re at risk of not having enough to build a reserve, pay loan obligations, or pay yourself reasonably.
Want help putting this number to work in your business? That’s exactly the kind of thing we set up together in coaching.