term profitability of each person, in any way relevant to economics, is associated with the concept of efficiency of economic activities.If a more detailed approach to the value of the words economy and efficiency, it is quite easy to make a conclusion that the two very similar in nature concept.
Generally, profitability is a ratio of income and costs and are often expressed as a percentage.From the standpoint of economic efficiency can be characterized by any kind of business that is profitable.Criterion of the level of profitability is one of the basic indicators to measure economic activity in the economic analysis.Modern science has identified several types of profitability and in some cases, it is denoted by a factor of profitability, or profitability.
Classification of financial-economic index is arranged in relation to the object of the return.In this case can be calculated, for example, return on assets and profitability, return on investment and return on sales.But not always margins reflect the real situation of an economic entity in the short term.Setting aside the amateurish thinking, the modern economic analysts are trying to focus their attention on the aggregate, or otherwise, in gross terms.Thus, the gross profit margin shows the overall assessment of profitability, expressed percentage.In the literature, the financial focus, the gross margin is regarded as a comprehensive indicator of activity in the context of certain types of profitability.Gross profit margin - a kind of performance evaluation of commercial units of any organization.
more specific indicator of economic efficiency may be only the net profit.The difference between these terms is a different calculation methodology, if the profit - the difference of income and expenses, the profitability - this is their attitude.Profitability Gross - this kind of indicator of economic benefit often apply with regards to major investment.The impact of global investments in various sectors of the economy is very difficult to calculate in detail for all types of profits, since there is likely something is not taken into account.
In general terms, the gross margin should be the assessment of the economic efficiency of enterprises, reflecting the efficient use of labor, material, money and other resources.Cost-benefit analysis is carried out regularly in each well-functioning company.Its main purpose is to identify the least and the most profitable aspects of the business.As a result of this analysis is built line strategy in the long and short term.Profitability reflects the gross share of gross profit, which is earnings per unit.
to separate business unit, which has a small staff and, as a consequence, small financial flows passing through the internal record keeping will be more appropriate to focus not only on such indicators as profitability, gross, and all of its individual species.In this case, you can identify weaknesses, which enables to take timely action to neutralize their influence on the final result of the activity, that is, the company's profits.