compression of margins

USAGE SUMMARY

The phrase "compression of margins" is correct and usable in written English.
It can be used in contexts related to finance, business, or any field where the reduction of profit margins or operational margins is discussed. Example: "The company is facing a compression of margins due to increased competition and rising costs."

✓ Grammatically correct

Science

News & Media

Formal & Business

Human-verified similar examples from authoritative sources

Similar Expressions

60 human-written examples

The Organisation for Economic Co-operation and Development recently noted (about UK experience in the year 2000): 'Exports picked up, reflecting the dynamism of demand overseas, but market share erosion continued owing to strength of the pound, despite the compression of exporters' margins... On most estimates the pound remains overvalued.

The Guardian - Business

Major Chinese banks reported broadly flat first-half earnings, but their second-quarter profits jumped from a year earlier as the lending spree outweighed compression of net interest margins.

The New York Times

To assess the bacterial contamination risk in cataract surgery associated with mechanical compression of the lid margin immediately after sterilization of the ocular surface.

Journal of Cataract & Refractive Surgery

In any phase of growth it is not uncommon to see a compression in margins and returns.

The Economist

Shares are 43% below their March high amid fears of margin compression and a short-seller’s dubious report.

Forbes

This kind of margin compression doesn't cover overhead, which for a big operator can run half a billion annually.

Forbes

"In the short term, their profits will be squeezed due to the compression in lending margins.

The New York Times

MR angiography shows extrinsic arterial compression with smooth margins [3].

Insights into Imaging

The adenomas (Fig. 2B and C) that either had solid or papillary patterns with compression of adjacent normal tissue at the margin, occurred in Men1+/− mice aged ≥15 months.

Endocrine-Related Cancer

However, in patients with HD, on neck flexion the tight dural sac cannot compensate for the increased length of posterior wall, which causes anterior shifting of the posterior cervical dural wall and consequent compression of the cord against the posterior margin of adjacent vertebral bodies.

BioMed Research International

Stratification of margins.

British Journal of Cancer

Expert writing Tips

Best practice

When discussing financial performance, use "compression of margins" to highlight the specific pressure on profitability due to factors like increased costs or competition.

Common error

Avoid using "compression of margins" in contexts where simple cost reduction or efficiency improvements are discussed; the phrase is best suited for situations where external pressures are actively squeezing profitability.

Linguistic Context

Noun phrase that typically functions as a subject, object, or complement in a sentence. It describes a financial or business situation. According to Ludwig, the phrase is correct and usable in written English, usually in contexts of finance and business.

Expression frequency: Missing

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Ludwig's WRAP-UP

The phrase "compression of margins" refers to a reduction in the difference between a company's revenues and costs, leading to decreased profitability. Ludwig confirms that the phrase is grammatically correct and suitable for professional writing. Alternative phrases like "margin squeeze" or "profit margin erosion" can be used depending on the specific context. When using the phrase, ensure it aligns with situations where external pressures or internal issues are actively impacting profitability. It's a professional term best suited for business and financial contexts.

More alternative expressions

Phrases that express similar concepts, ordered by semantic similarity:

Margin squeeze

This alternative is more concise and directly implies the act of reducing margins.

Profit margin erosion

This alternative focuses specifically on the reduction of profit margins over time.

Narrowing of margins

This alternative describes the process of margins becoming smaller.

Shrinking margins

This alternative uses a more dynamic verb to convey the reduction in margins.

Margin reduction

This alternative is a more general term for decreasing margins.

Reduced margins

This is a straightforward way of saying that margins have decreased.

Cost compression

This alternative focuses on reducing costs, which can lead to margin improvements or offset margin compression.

Decreased profitability

This alternative highlights the impact of margin compression on overall profitability.

Margin deterioration

This suggests a decline in the quality or health of margins.

Pressure on margins

This alternative emphasizes the external forces causing margins to decrease.

FAQs

What does "compression of margins" mean in business?

In business, "compression of margins" refers to a situation where the difference between a company's revenues and its costs is decreasing, leading to lower profitability. This can be due to various factors like increased competition, rising input costs, or pricing pressures.

What are the main causes of "compression of margins"?

Several factors can cause "compression of margins", including increased competition, rising input costs, changes in market demand, and regulatory changes that impact pricing or costs.

How can companies respond to "compression of margins"?

Companies can respond to "compression of margins" by implementing strategies to reduce costs, improve efficiency, differentiate their products or services, or explore new markets to increase revenue.

What's the difference between "margin squeeze" and "compression of margins"?

While both terms describe a reduction in profitability, "compression of margins" is a more general term, whereas "margin squeeze" often implies that the reduction is caused by external pressures from suppliers, customers, or competitors actively reducing a company's margins.