While a retailer's overall gross margin is high,its net profit margin is low.This indicates that the retailer should reevaluate its use of markdowns.

Question

Quizplus · Accepted Answer

A high gross margin means that the retailer is marking up the price of its products significantly. However, a low net profit margin indicates that the retailer is experiencing high expenses that are eating into its profits. The issue may or may not be related to markdowns. The retailer needs to thoroughly analyze its expenses to identify the root cause of the problem.

While a Retailer's Overall Gross Margin Is High,its Net Profit