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BUSINESS FINANCING GLOSSARY

Profit Margin

Profit as a percentage of revenue. Net margin (after everything) and gross margin (after direct costs) tell different parts of the story.

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Related terms

Annual Revenue→Your total gross sales over a 12-month period, before expenses. A core input lenders use to size how much you can borrow.Debt Service Coverage Ratio (DSCR)→Net operating income divided by total debt payments. Above 1.0 means you generate more than enough to cover debt; lenders often want 1.15–1.25+.Gross Revenue→Total sales before any expenses or deductions. The headline “top line” lenders start from when sizing an offer.

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