ECONOMICS

Detailed explanation-1: -A decrease in cost of goods sold will cause an increase in gross profit margin. Finding lower-priced suppliers, cheaper raw materials, using labor-saving technology, and outsourcing, are some ways to lower the cost of goods sold.

Detailed explanation-2: -There are 3 main ways to improve the profitability of your company: Sell more, price higher and reduce costs. Some organisations focus mainly on selling and on delivering great service to customers. That is great. Let us remember that profits can also be increased by greater cost efficiency.

Detailed explanation-3: -Lower Prices Lowering your prices to generate sales can also reduce gross profit margin. Some companies routinely offer discounts and promotions to attract buyers. While you may get a sale, large price cuts minimize the gross profit you get on it.