Return on Sales (ROS)

Return on Sales formulaDefinition

Return on Sales (ROS) is the measure of net profit as a percentage of sales revenue. It is an indicator of profitability that is often used to compare the profitability of companies and industries of differing sizes.

ROS does not account for the capital (investment) used to generate the profit.

Return on Sales (%) = Net Profit ($)/Sales Revenue ($)

See Also

Return on ad spend
Return on investment
Return on marketing investment
Return on objective

References

  1. Farris, Paul W.; Neil T. Bendle; Phillip E. Pfeifer; and David J. Reibstein (2010). Marketing Metrics: The Definitive Guide to Measuring Marketing Performance (Second Edition). Upper Saddle River, New Jersey: Pearson Education, Inc.

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