Wednesday, June 6, 2012

Whose Profit Margin Tops 60%?

Marketing pop quiz! Match the company with its approximate profit margin:

1. Tiffany
2. Mattel
3. Dell
4. Whole Foods Markets
5. Rovio

A. 21%
B. 30%
C. 50%
D. 57%
E. 64%

Answers:
 1-D, 2-C, 3-A, 4-B, 5-E
  • Dell's gross profit margin (computers, electronics) is a bit over 21%. 
  • Whole Foods Markets (food retailing) enjoys gross profit margins of more than 30%. 
  • Mattel's margin (toys) is a little over 50%. 
  • Tiffany's (jewelry) margins are higher than 57%.
  • Rovio's gross margin is so high because the Angry Birds parent company gets 30% of its $100 million in annual revenues from licensing and the rest mainly from game downloads. Looking ahead, can Rovio prove it's not a one-hit wonder?

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