Retailer ARetailer BNet Sales$200,00$340,000COGS$83,000$180,000Operating Expenses$50,000$93,000Using the information above, calculate each retailer's gross margin percent and net operating profit percent. Compare the two and discuss which retailer is performing better. What could the poorer performing retailer do to increase their financial performance?
What will be an ideal response?
| Retailer A | Retailer B | |
| Net Sales | $200,000 | $340,000 |
| COGS | $83,000 | $180,000 |
| Gross Margin $ | $117,000 | $160,000 |
| Gross Margin % | 58.5% | 47.1% |
| Operating Expenses | $50,000 | $93,000 |
| Operating Exp% | 25% | 27.4% |
| NOP $ | $67,000 | $67,000 |
| NOP % | 33.5% | 19.7% |
Retailer B should strive to decrease their cost of goods sold by negotiating with vendors for lower prices and try to sell more merchandise at higher prices to increase their gross margin. Retailer B could also strive to decrease their operating expenses.
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