If your gross margin is too low, you have to fix it.
Let’s say you buy wizzys for $1.00 and sell them for $1.03. Even if you sold $1,000 worth of them, you’d only have $30 in gross margin. How can you pay the rent and all your people like that? You probably can’t.
If you figured out how to buy wizzys for $0.90 and sell them for $1.15, then if you sold $1,000 worth of them you’d have $217.39 in gross profit. It will be easier to run your business on that, right?
Or you could invent/design a new wizzy that cost $0.60 that you can sell for $0.98, or you can add a feature so people will pay $1.40 for your high-end wizzy.
You have to make a gross margin – that’s what your business runs on – gross margin, not gross revenue.
And a Good Morning to you, too, sir. 🙂
Amen!!
Thanks for continuing to enlighten our industry, we are skilled knowledgeable talented etc and should get paid accordingly. First we have to recognize our own worth! Proud to be a professional contractor