Sample Profit & Loss Statement

The organization of your income statement is incredibly important.  For example, all direct selling expenses should be grouped together and not shown as part of other operating expenses.  That is because the direct selling expense to sales ratio is critical.  This typically ranges from 25% to 35% for consumer (B2C) catalog companies and approximately 20% for business-to-business (B2B) catalogers. See how your ratios compare with our industry ratios.  It is normal for ratios will vary by company.

B2B B2C
Total Gross Merchandise Sales 97.50% 106.00%
Less: Returns & Allowances -2.50% -6.00%
Net Sales 100.00% 100.00%
Less: Cost-of-Goods 48.00% 40.00%
Gross Margin 52.00% 60.00%
Direct Selling Expenses
Creative/Preparation 1.50% 3.06%
Print and Paper; Ink-Jet Address 7.00% 8.30%
Postage 5.00% 11.60%
List Rental 1.00% 2.71%
Merge / Purge 0.75% 0.30%
Internet Marketing 3.00% 3.50%
Total – Direct Selling Expenses 18.25% 29.47%
Operating Expenses
Packing Materials 0.65% 1.50%
Outbound Freight 5.00% 9.60%
Shipping & Handling Revenue -6.00% -14.85%
Telephone Line Charges 1.00% 2.10%
Salaries and Wages 1.00% 10.60%
Total Payroll Taxes 1.00% 1.00%
Total Employee Benefits 1.00% 1.60%
Credit Card Fees 0.25% 3.00%
Rent 1.25% 2.40%
Depreciation 0.50% 0.80%
Utilities 0.50% 0.60%
Insurance 0.25% 0.30%
Equipment Rentals 0.75% 0.50%
Maintenance & Repairs 0.60% 0.35%
Dues, Fees and Subs 0.15% 0.04%
Professional Fees 0.80% 2.50%
Office Postage 0.80% 0.19%
Supplies 0.80% 0.40%
Travel and Entertainment 0.50% 0.30%
Other G&A Expenses 1.00% 1.10%
Interest Expenses 0.50% 1.80%
Total – G&A Expenses 12.30% 25.83%
Total SG&A Expenses 30.55% 55.30%
Operating Income (Loss) 21.45% 4.70%
Net List Rental Income 0.50% 1.00%
Income (Loss) – EBIT 21.95% 5.70%