Track gross and net profit margins

Gross margin shows if your pricing works; net margin shows if the whole business works. Tracking both tells you whether the money you make delivering work actually survives all your overhead.

Do this

1. Calculate gross margin: (revenue − cost to deliver) ÷ revenue.
2. Calculate net margin: net profit ÷ revenue.
3. Track both monthly and compare to your targets.
4. If gross is healthy but net is thin, your overhead is the problem.

Gross vs. Net Margin

GROSS MARGIN = (Revenue − Cost to Deliver) ÷ Revenue → Is your pricing and delivery profitable?

NET MARGIN = Net Profit ÷ Revenue → Does the whole business make money after ALL costs?

Example: Revenue: $100k Cost to deliver: $55k → Gross margin 45% Other expenses: $35k → Net profit $10k → Net margin 10%

Healthy gross + thin net = cut overhead. Thin gross = fix pricing.