What is the calculation formula of hotel gross profit margin?

What is the calculation formula of hotel gross profit margin?

GrossProfitMargin is the percentage of gross profit and sales revenue (or operating revenue), where gross profit is the difference between revenue and operating costs corresponding to revenue.

Expressed by the formula: gross profit = gross profit/operating income × 100%= (main business income-main business cost)/main business income × 100%.

In terms of composition, gross profit margin is the difference between income and operating costs, but in fact this understanding confuses the concept of gross profit margin. In fact, the gross profit margin reflects the value increase of a commodity after its production is transformed into an internal system. In other words, the more value added, the more gross profit naturally. For example, through the differentiated design of R&D, products have added some functions compared with competitors, and the marginal price has increased to a positive value, so the gross profit has also increased.

Gross profit margin usually depends on what factors.

1, market competition

If there is no such product in the market, or there are few such products, or this product has advantages in quality and functional value compared with similar products in the market, then the price of the product naturally adopts a high price strategy. On the contrary, if the market is saturated by operating high-road products or sunset industries, it can only be achieved by following the sales price of the crowd and realizing the average sales gross profit.

2.R&D cost

A feature of modern economy is that products are updated quickly. If new products with emerging functions can be developed faster and better, and the products have advantages in function, use value and price, who can occupy the highest point in the market? Enterprises have a lot of R&D investment, usually they have many inventions, and they get more benefits from patent protection. Emerging products have great advantages in cost and efficacy, and their gross profit is also large.

3. Fixed costs

Mainly refers to the investment in fixed assets, such as machinery and equipment, workshop, workshop rent, etc., which constitute fixed manufacturing expenses. From a certain perspective, it also reflects the entry threshold of enterprises. In order to recover this huge investment cost, enterprises will also increase the gross profit of products. On the other hand, if enterprises invest less in machinery and equipment, or assemble and process them in the form of OEM, or entrust processing, part of their sales profits will be given to third-party manufacturers, and the gross profit of their products may only be average.

4. Technical cost

For example, if an enterprise produces patented products with independent intellectual property rights, especially invention patents and technology patents, and the patented products have advantages over the original similar products in the market in terms of product quality and product function, have cost advantages, are exclusive in competition, and naturally have the ability to raise prices. At this time, the gross profit of products is usually higher;

5, technical process

The technical requirements of employing people, the size of labor costs, the complex production technology of products, high technical content, and the high level of technicians used will naturally increase the gross profit of their products. On the contrary, the road products with simple technology, low technical content and mostly operated by ordinary workers cannot have high gross profit.

What is the calculation formula of hotel gross profit margin? Enterprises need to calculate their income when dealing with accounts. There are requirements for calculating gross profit and gross profit margin in the income of enterprises. In the above article, we introduced the calculation formulas of gross profit, gross profit margin and other indicators, and the specific calculation method can refer to our introduction above.