It seems that he's using the following definitions:
1) [Sales Revenue] - [Cost of the Goods Sold] = [Gross Profit]
2) [Sales Revenue] - [Cost of Goods Sold] - [Expenses] = [Net Profit]
So then do
[Expenses] / [Gross Profit] = ["Your expenses as a percentage of gross profit"]
This % allows you to get a better idea of how much you could increase your [Net Profit] by reducing [Expenses] (e.g. by making advertising, rent, salaries, etc. more efficient)
