business profitability
Business profitability refers to the ability of a company to generate more revenue than its expenses over a specific period. It is a key indicator of financial health and success, often measured using metrics like net profit margin and return on investment. A profitable business can reinvest in growth, pay dividends to shareholders, and sustain operations.
To achieve profitability, businesses must effectively manage their costs while maximizing sales. This involves strategies such as optimizing pricing, reducing waste, and improving operational efficiency. Understanding profitability helps business owners make informed decisions and plan for the future.