Sales grew 40%. Profit fell. Trace exactly where the margin went.
Revenue went up and profit went down is the most common sentence in Indian consumer businesses. Enter two periods side by side; the bridge shows exactly which line — COGS, freight, returns, channel fees, or discounts — ate the margin, and by how much.
Illustrative composite case — not a client engagement
A consumer brand's sales head reported a record year. The CFO reported a worse one. Here is the P&L. Before the reveal: what do you think ate the profit?
| Line | Year 1 | Year 2 |
|---|---|---|
| Revenue | ₹10.0 Cr | ₹14.0 Cr |
| Growth | — | +40% |
| COGS | 61% | 62% |
| Marketplace & channel fees | 3% | 9% |
| Discounts & schemes | 4% | 8% |
| Returns | 1% | 4% |
| Contribution | ₹3.1 Cr (31%) | ₹2.38 Cr (17%) |
The bridge compares contribution (revenue minus all variable commercial costs) across two periods, isolating the year-over-year change in each line.
Costs are entered as % of revenue so mix effects are visible. Enter each cost once — if an expense already sits inside COGS, leave its line at zero. Double counting is how margin bridges lie.
The tool separates gross contribution from operating profit deliberately: overheads only appear if you have the data. Growth that dilutes contribution percentage is flagged even when absolute contribution rises.
Illustrative figures, not a client outcome.
Gross margin subtracts product cost. Contribution subtracts everything variable that the sale attracts — fees, freight, returns, schemes. Decisions made on gross margin routinely misprice channels.
Not necessarily — but the growth bought with dilutive channels or schemes must be a deliberate, measured investment, not an accident. The bridge tells you which it was.
Year-over-year for seasonality businesses, quarter-over-quarter otherwise. Match periods carefully — comparing Diwali month to a lean month manufactures a fake leak.
Version 1.0 · Reviewed 2026-10 · Methodology is fixed and version-controlled; results depend on your inputs.
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