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Updated almost 6 years ago on . Most recent reply

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17
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6
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Winnie Rim
  • Flipper/Rehabber
  • Tacoma, WA
6
Votes |
17
Posts

Meaning of the word "Margin"

Winnie Rim
  • Flipper/Rehabber
  • Tacoma, WA
Posted

Can someone please explain fo me in depth what the word "Margin" means in buisness? And how to calculate it.

I see explanations on Google but they're all different, not sure which one refers to the correct definition in using Margins in real estate investing calculations.

Most Popular Reply

Account Closed
  • Specialist
  • Paradise Valley, AZ
2,936
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3,447
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Account Closed
  • Specialist
  • Paradise Valley, AZ
Replied
Originally posted by @Winnie Rim:

Can someone please explain fo me in depth what the word "Margin" means in buisness? And how to calculate it.

I see explanations on Google but they're all different, not sure which one refers to the correct definition in using Margins in real estate investing calculations.

It's simply the markup without regard to cost of sales. So, if you buy a candy bar for $1.00 and sell it for $1.25 you have a margin of 25%. From your margin you subtract costs to arrive at your profit.

To me, the more important question is how much do I wind up with in my pocket after everything is said and done. 

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