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3M Co's cost of goods sold for the three months ended in Dec. 2015 was €3,513 Mil. Its cost of goods sold for the trailing twelve months (TTM) ended in Dec. 2015 was €13,936 Mil.
Cost of Goods Sold is directly linked to profitability of the company through Gross Margin. 3M Co's Gross Margin for the three months ended in Dec. 2015 was 47.56%.
Cost of Goods Sold is also directly linked to Inventory Turnover. 3M Co's Inventory Turnover for the three months ended in Dec. 2015 was 1.08.
Cost of goods sold (COGS) refers to the Inventory costs of those goods a business has sold during a particular period.
3M Co Cost of Goods Sold for the trailing twelve months (TTM) ended in Dec. 2015 was 3530.44442391 (Mar. 2015 ) + 3437.58353381 (Jun. 2015 ) + 3454.51305355 (Sep. 2015 ) + 3513.2653998 (Dec. 2015 ) = €13,936 Mil.
Cost of Goods Sold is directly linked to profitability of the company through Gross Margin.
3M Co's Gross Margin for the three months ended in Dec. 2015 is calculated as:
|Gross Margin||=||(Revenue||-||Cost of Goods Sold)||/||Revenue|
A company that has a moat can usually maintain or even expand their Gross Margin. A company can increase its Gross Margin in two ways. It can increase the prices of the goods it sells and keeps its Cost of Goods Sold unchanged. Or it can keep the sales price unchanged and squeeze its suppliers to reduce the Cost of Goods Sold. Warren Buffett believes businesses with the power to raise prices have moats.
Cost of Goods Sold is also directly linked to another concept called Inventory Turnover:
3M Co's Inventory Turnover for the three months ended in Dec. 2015 is calculated as:
Inventory Turnover measures how fast the company turns over its inventory within a year. A higher inventory turnover means the company has light inventory. Therefore the company spends less money on storage, write downs, and obsolete inventory. If the inventory is too light, it may affect sales because the company may not have enough to meet demand.
Usually retailers pile up their inventories at holiday seasons to meet the stronger demand. Therefore, the inventory of a particular quarter of a year should not be used to calculate inventory turnover. An average inventory is a better indication.
3M Co Annual Data
3M Co Quarterly Data