How do you conduct a revenue analysis?
Asked 2 years ago
Hello everyone, I need some direction. I started a Shopify business and realized that I needed to keep better track financially. Any tips for doing a revenue analysis?
Chace Franco
Wednesday, February 16, 2022
Here is how to conduct a revenue analysis;
- Account for all the revenues or dales during the time period
- Add up all the costs of goods sold and subtract the total from the revenue to get gross margin
- Divide gross margin by total revenue and convert to a percentage. Compare the margins from previous periods and if it's an increase it means you're gaining high profits. Analyze also why the gross margin has changed from the previous years.
- Now add up the other expenses and compute them as a percentage of sales. Also, compute each cost as a percentage of sales and compare from previous periods.
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