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INCREASE PROFITABILITY WITH OUR 5 PROFIT IMPROVEMENT TIPS

Definition of Profit

Definition of Profit
Profit is an absolute number determined by the amount of income or revenue above and beyond the costs or expenses a company incurs.

Definition of Profitability
Profitability is the ability of a company to use its resources to generate revenues in excess of its expenses. In other words, this is a company’s capability of generating profits from its operations. Profitability is a measurement of efficiency.

5 Tips to Increase Profitability
1. Increase revenue – Sell more to your existing customers – what complimentary products or services can you add to your offering. Get new customers- who are your new customers and how are you going to get them? When was the last time you reviewed your pricing? 

2. Manage costs – review your profitability for each product or service line. Do you understand your true costs? Review each expense, you can renegotiate most. Don’t cut costs for the sake of cutting costs, determine how the expense adds value to your business. Set a budget and review it regularly against actual expenditure.

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