Contribution margin ratio (dækningsgrad)
The contribution margin ratio (dækningsgrad) is the contribution margin measured as a percentage of revenue. The contribution margin is revenue minus variable costs, so the ratio shows what share of each krone of sales remains for fixed costs and profit.
The figures behind the term
Source: companydata.dk, CVR and annual reports, updated 16 October 2026
Contribution margin ratio = contribution margin / revenue x 100. If a company sells for DKK 2,000,000 with variable costs of DKK 1,200,000, the contribution margin is DKK 800,000 and the ratio is 40 %. The figure is used internally for pricing, break-even analysis and for judging which products contribute most.
Contribution margin ratio and gross margin
The two concepts look alike but rest on different cost splits. Gross margin deducts direct costs (cost of goods), while the contribution margin ratio deducts all variable costs, including for example commission and freight. In trading companies the two figures are often close.
Frequently asked questions
What is the contribution margin ratio?
The contribution margin as a percentage of revenue. In published annual reports it is calculated in practice as gross profit measured against revenue.
What is it used for?
To judge how much each krone of sales contributes towards covering fixed costs and producing a profit.
Why does it differ so much between industries?
Because the share of variable costs varies. Retail typically has a low ratio, while consulting and software sit high.
Related terms
Gross margin (bruttoavance)
Gross margin (bruttoavance) is gross profit relative to revenue, usually expressed as a percentage. Where gross profit is an amount in kroner, gross margin shows what share of each krone of sales remains once direct costs are paid.
Gross profit (bruttofortjeneste)
Gross profit (bruttofortjeneste) is revenue minus the direct costs of delivering goods or services (e.g. cost of goods sold). For most small Danish companies, gross profit is the top line of the published financial statements, because revenue may be omitted.
Profit margin (overskudsgrad)
The profit margin (overskudsgrad) shows how large a share of revenue ends up as operating profit. It is calculated as operating profit divided by net revenue, multiplied by 100.
Revenue (omsætning)
Revenue (nettoomsætning) is a company's total income from sales of goods and services in the fiscal year, excluding VAT and net of discounts.