COGS, or Cost of Goods Sold, is a metric that measures the amount of money spent on producing the goods a business sells. It’s often expressed as a percentage of total revenue to give an idea of how much of the company’s sales are devoted to covering the costs of making their products. This number can be a useful way to assess a company’s efficiency and help identify areas of improvement. By understanding and tracking their COGS as a percent of revenue, businesses can ensure they are maximizing profits and staying competitive in their markets.