Schema Theory

Description

Gross Margin % measures the proportion of revenue that exceeds the cost of goods sold (COGS). It indicates how efficiently a company produces and sells its products and is a key profitability metric.

Formula: (Revenue - COGS) / Revenue

Visual Example

DAX Formula

Gross Margin % = 
DIVIDE(
    SUM(Sales[Revenue]) - SUM(Sales[COGS]),
    SUM(Sales[Revenue])
)          

SQL Statement

SELECT
  (SUM(Revenue) - SUM(COGS)) / NULLIF(SUM(Revenue), 0) AS GrossMarginPct
FROM Sales;

Usage Notes

• Use time-based filters (e.g., Date, Month, Year) to evaluate margin trends over time.
• Pair with product, region, or channel dimensions to identify high- or low-margin segments.
• Ensure Revenue and COGS are captured consistently per transaction to avoid calculation distortions.
• Consider supplementing with net margin or contribution margin for broader profitability analysis.

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