Profitability, “The state or condition of yielding a financial profit or gain. It is often measured by price to earnings ratio.” This definition comes from businessdictionary.com. When you break the word down you have ‘profit’ and ‘ability, your business’s ‘ability’ to make a ‘profit’.
What does profitability mean to you? What is should mean is that you are able to conduct your business in such a way that you cover your expenses, cost of goods sold and after you pay yourself you still have money left to reinvest in your business. Sound complicated, confusing, impossible maybe! Maybe you just don’t care. In which case you can stop reading now and go on to doing something else.
Now, if you are still reading you must be interested in finding ways to improve your business’s profitability.
- What are your costs of goods sold, your general expenses, what are your ratios for cost of goods against sales, or expenses against sales?
- What should they be?
- How do you get them to where they should be? Are you paying yourself? Should you be?
- Are there expense leaks? How do you stop cash from leaking out?
- Paying yourself? How much? Are you making a living?
- Is your pricing appropriate for your business, your quality, your desired growth?
- Who is your client? What are their expectations? Are you priced to attract your target demographic?
- What goals do you have for your financial future and that of your business?
- How do you assure profitability? And the list goes on…
Scared, frustrated, confused, lost, all of the above? The good news is there is help for you. We have more than thirty-five years of experience in creating profitable, custom price lists for businesses just like yours. We will begin by addressing many of the questions listed above and then help you create a pricing model which will be appropriate for your business and your future goals.
And we won’t leave you there. We will consult with you once a quarter for one year after the initial pricing structure is complete to assure what we have created with you is right for you and your business. If necessary we will make modifications along the way to help you reach your financial goals.
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Find us on the web at itsc123.com