Cookie Preference Centre

Your Privacy
Strictly Necessary Cookies
Performance Cookies
Functional Cookies
Targeting Cookies

Your Privacy

When you visit any web site, it may store or retrieve information on your browser, mostly in the form of cookies. This information might be about you, your preferences, your device or used to make the site work as you expect it to. The information does not usually identify you directly, but it can give you a more personalized web experience. You can choose not to allow some types of cookies. Click on the different category headings to find out more and change our default settings. However, you should know that blocking some types of cookies may impact your experience on the site and the services we are able to offer.

Strictly Necessary Cookies

These cookies are necessary for the website to function and cannot be switched off in our systems. They are usually only set in response to actions made by you which amount to a request for services, such as setting your privacy preferences, logging in or filling in forms. You can set your browser to block or alert you about these cookies, but some parts of the site may not work then.

Cookies used

ContactCenterWorld.com

Performance Cookies

These cookies allow us to count visits and traffic sources, so we can measure and improve the performance of our site. They help us know which pages are the most and least popular and see how visitors move around the site. All information these cookies collect is aggregated and therefore anonymous. If you do not allow these cookies, we will not know when you have visited our site.

Cookies used

Google Analytics

Functional Cookies

These cookies allow the provision of enhance functionality and personalization, such as videos and live chats. They may be set by us or by third party providers whose services we have added to our pages. If you do not allow these cookies, then some or all of these functionalities may not function properly.

Cookies used

Twitter

Facebook

LinkedIn

Targeting Cookies

These cookies are set through our site by our advertising partners. They may be used by those companies to build a profile of your interests and show you relevant ads on other sites. They work by uniquely identifying your browser and device. If you do not allow these cookies, you will not experience our targeted advertising across different websites.

Cookies used

LinkedIn

This site uses cookies and other tracking technologies to assist with navigation and your ability to provide feedback, analyse your use of our products and services, assist with our promotional and marketing efforts, and provide content from third parties

OK
BECOME
A MEMBER
TODAY TO:
CLICK HERE
[HIDE]

Here are some suggested Connections for you! - Log in to start networking.

Is Your Business Profitable? Here’s How To Tell - Carol Evenson - ContactCenterWorld.com Blog

Is Your Business Profitable? Here’s How To Tell

People go into business for many reasons, from helping the planet to changing the status quo. What they all have in common is that they typically want to generate profit. Businesses will want to do what they can to generate profit, so the numbers should reflect this accordingly. How much profit does your business generate? There are several ways to figure out how well your business is doing. Using some simple calculations, you can quickly figure out your financial position. Here's what you can do to figure it out.

 

  1. Canvas Your Operating Expenses

Operating expenses are at the core of every business. "It takes money to make money," which is relevant for growing companies. Most businesses will have their fair share of expenses prior to generating any profit.


Sponsor message - content continues below this message

2022 '17th annual' Global Contact Center World Awards NOW OPEN

Enter your Center, Strategy, Technology Innovation, Teams and Individuals into the ONLY TRULY GLOBAL awards program - regarded by many as being like the Olympics for the Contact Center World! Join the best from over 80 nations and compete for the most prestigious awards out there!

FIND OUT MORE HERE


Content continues ….

Optimally, it would be best to keep operating expenses low while maintaining high sale prices. This leaves you plenty of room to account for any emergency expenses and to have extra investment capital. A reliable sales pipeline can keep your business running and your customers happy. In some cases, your operating expenses can exceed that of your incoming profits. If this happens, then you'll need to make changes in order to make ends meet or to increase your profit margins. Please note that not all expenses can be reduced or removed. You can do what you can to reduce as many expenses as possible, but there will be a point where cutting costs can adversely affect the quality of your services if they can still be offered at all. Keep an eye on your main product or service when working with costs so that your business can keep flourishing for years to come.

 

  1. Perform a Break-Even Analysis

Does it seem like your business is making more money, but there doesn't seem to be any profit? You may be at the "break-even" point, a common position for new businesses and businesses making big changes. If your incoming revenue and your outgoing expenses are at the same level, then you are considered to be breaking even. Although breaking even isn't necessarily a bad thing (because you're not necessarily losing anything), it does defeat the purpose of doing business in the first place, which is to generate profit. If you do find yourself at this level, then it's time to make some changes to set your business up for big profits, rather than to break even. A simple way to calculate the break-even point is with this formula:

Business expenses = Breaking-even revenue

The business expenses include both variable and fixed expenses.

 

  1. Calculate Gross Profit Margin Ratio

Your gross profit is the number you get by subtracting the cost of goods from the sale amount. This is a good "raw" number to take into account. In general, you'll want this to be a positive number, rather than a negative one. Take it a step further to calculate the gross profit margin ratio:

(Gross Profit / Total Income) x 100 = Gross Profit Margin Ratio

A high ratio means that you’re profiting. A small ratio means that you're nearing the break-even point. Try to increase the ratio by making adjustments in your business. A stable ratio signifies stable business operations.

 

  1. Confirm Net Profit Margin Ratio

Similar to the gross profit margin ratio, the net profit margin ratio takes into account government taxes. This is the number you get after deducting taxes. You may calculate the net profit margin ratio using this formula:

(Net Income / Total Income) x 100 = Net Profit Margin Ratio

It's important to calculate this number because this is the realistic amount that you can get from your business.

 

Is Your Business Profitable?

You may wonder how much profit your business is taking in, or perhaps how much it's losing. It's important to know these numbers in order to be better able to manage your finances and to plan for future expenses such as investments. These methods for calculating business profits can help you understand the bigger picture. If you haven't already, get your finances in order with these tips.

Publish Date: October 24, 2021 3:28 PM

About us - in 60 seconds!

Newsletter Registration

Please check to agree to be placed on the eNewsletter mailing list.

Latest Americas Newsletter
both ids empty
session userid =
session UserTempID =
session adminlevel =
session blnTempHelpChatShow =
CMS =
session cookie set = True
session page-view-total = 1
session page-view-total = 1
applicaiton blnAwardsClosed =
session blnCompletedAwardInterestPopup =
session blnCheckNewsletterInterestPopup =
session blnCompletedNewsletterInterestPopup =