Gross margin

The share of your sales left after the direct cost of what you sold, such as materials, goods and subcontractors, before rent, wages and other overheads. At a 40 percent gross margin, €100 of sales leaves €40 of gross profit and €60 was direct cost.

Why it matters

It sets how much cash your inventory and supplier bills actually hold, which is why the estimate asks for it rather than assuming.