COGS Analysis, or Cost of Goods Sold Analysis, is a business tool used to help optimize sales performance by tracking cost efficiency in regards to the production of goods. By analyzing and understanding your Costs of Goods Sold (COGS), you can better assess areas of potential improvement—allowing for more efficient operation and higher profits. By breaking down comprehensive sales data into smaller pieces, examining factors such as product costs and labor expenses, you can gain real-time insight into how much it costs you to produce each item you sell. This level of detail provides invaluable information about the overall health of your business, helping you make informed decisions about how to best allocate your resources.