Net profit
09 · ProfitabilityWhat is left after all costs?
Gross margin only counts direct costs. Net profit also takes off everything else the business pays for, such as rent, salaries, transport, software, interest and tax. It shows whether the business makes money.
What to track
Net profit
Revenue minus all costs for the period.
Net margin
Net profit divided by revenue, shown as a percentage.
Overheads
Costs that do not change with each sale. Watch whether they grow faster than sales.
Review it monthly.