What is margin?
A simple way to explain margin is what you can sell your products or services for versus what it costs to create those products or services.
In short, the difference between the selling price and what it costs you to make or buy those products or services.
It is so important to get this right because if you get it wrong, you may end up with no money or profit.
The reason that some businesses suddenly make less money is that they have no idea that there’s been a decrease in their margin.
A slight decrease in margin can cause a big problem because the margin is what is left to cover your overheads.
Keeping track of your margin is obviously very important and this is where a software like Xero comes in handy.
HINT: On your Xero dashboard, track your margin so that you can keep it front of mind and ensure that it remains constant.