Double your business profits
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Double your business profits

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Strategic insights on how to increase business profitability, improve return on investment through strategic business and marketing plans. Find out how you can create value for your clients and ...

Strategic insights on how to increase business profitability, improve return on investment through strategic business and marketing plans. Find out how you can create value for your clients and ultimately boost profits. Check out http://www.business-plan.co.za

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Double your business profits Double your business profits Document Transcript

  • SMALLBUSINESS DOUBLE YOUR BUSINESS PROFITSSTART UP Value based solutions
  • Double your business profitsTurnaround your business! Strategically attract investors, create value for yourclients and boost business profitability. Click hereIf you are the owner of a business or contemplating starting abusiness, you should understand the importance of computingbusiness profitability. With any business, no matter what good orservice is being provided, it is very important that the ownerunderstand the business side of the business. The purpose ofcompany is to generate a profit.Revenue versus ProfitMany people think that profit is the money a business brings in.This is not true. The total money brought in by the business iscalled revenue and this is different from profit. For example, ifyou sell an item for $100, you have $100 of revenue. To get toprofit, you need to subtract the expenses out. For that $100product, it may have cost $50 to make, there could have beenadditional overhead costs of $10, and employee expenses of $5associated with that product. That would mean that there was$65 of expenses associated with that one product. So out of that$100 of revenue from the one product, you will make $35 ofprofit.
  • Double your business profitsAs you can see, it is important to set your business goals to makea profit, not just make revenue. This is the importance ofcomputing business profitability. You need to make sure that yourbusiness brings in enough money to not only cover the expensesbut make sure that there is something extra so that you can takesome money out of the business.Fixed Versus Variable ExpensesWhen computing business profitability, you will notice that yourbusiness has many different expenses. Some of these expensesare fixed and others are variable. Fixed expenses are expensesthat you must pay not matter how much product you make.Examples of fixed expenses are rent, employee expenses, andsome utility costs. In the above example, the $10 of overheadcosts and $5 of employee costs are fixed expenses.Variable expenses are expenses associated with creatingadditional product. In the above example the $50 cost to makethe product is a variable expenses. You only have this expense ifyou produce an additional product.
  • Double your business profitsIt is important in computing business profitability, that you makesure that you are at a minimum covering your variable expenses.If you are not covering your variable expenses, then you arelosing money with each unit you produce.Get Professional HelpComputing business profitability can be a tall order, especially fora small business owner. You should hire a competent accountantor attorney to help you with your analysis. There are manyprofitability ratios that can be used to show the health of yourbusiness.The More You KnowThe more you know about the profitability of your business, thebetter off you will be. It is important that you stay up to dateregarding the financial health of your business. You shouldconstantly be computing your business liability and making anynecessary changes.Turnaround your business! Strategically attract investors, create value for yourclients and boost business profitability. Click here
  • Double your business profitsGary Pearson is an accomplished niche website developer and author.To learn more about computing business [http://besthomebusinessnow.info/importance-of-computing-business-profitability] visit Best Home Business Now[http://besthomebusinessnow.info/] for current articles and discussions.Article Source:http://EzineArticles.com/?expert=Gary_Pearson