Factors that determine the profits of a business.

[btaliat]

Sometimes people always believe that the size of a business determine the profit of an organization. This may be true but it is relative. Sometimes, a small business that focuses on some items or products needed badly by the people or goods of high demand can be making so much gains even more than a big business.
Some big businesses that are cited where it there is no targeted customers may not be recoding big profits. Or if the business is not meeting or satisfying the immidiate needs of the people.
Another thing that may also cause the variation in profit making maybe style of management. If the managements are not competent or use some managerial methods that can yield profit. The companies no matter how big may still not yield profits whereas a small business that uses a good managerial style may be recoding huge profit.

 

[Josemendez]

You have said it all. In business , size and capital employed in the business do not really gurantee the success of the business. A business with huge capital investment may not survive within one month ,if the business failed to have a good management plan , a good location which is accessible.
Secondly , a business that do not have good market demand won't easily survive . Business needs to solve a problem in order to survive .and be profitable .

 

[Ephy]

Sometimes people always believe that the size of a business determine the profit of an organization. This may be true but it is relative. Sometimes, a small business that focuses on some items or products needed badly by the people or goods of high demand can be making so much gains even more than a big business.
Some big businesses that are cited where it there is no targeted customers may not be recoding big profits. Or if the business is not meeting or satisfying the immidiate needs of the people.
Another thing that may also cause the variation in profit making maybe style of management. If the managements are not competent or use some managerial methods that can yield profit. The companies no matter how big may still not yield profits whereas a small business that uses a good managerial style may be recoding huge profit.

The aim of any business is to make a profit not a loss. So there are several factors that

Sometimes people always believe that the size of a business determine the profit of an organization. This may be true but it is relative. Sometimes, a small business that focuses on some items or products needed badly by the people or goods of high demand can be making so much gains even more than a big business.
Some big businesses that are cited where it there is no targeted customers may not be recoding big profits. Or if the business is not meeting or satisfying the immidiate needs of the people.
Another thing that may also cause the variation in profit making maybe style of management. If the managements are not competent or use some managerial methods that can yield profit. The companies no matter how big may still not yield profits whereas a small business that uses a good managerial style may be recoding huge profit.

The main aim of any business is to make a profit not a loss. Therefore their is several factors that contribute to any business to make profits. The major or most important factor is customers. Every business to prosper they're must be customers to buy your products and also to have a higher demand for your products and services. Business also have other factors like employees too determines whether the business will make profits or losses in that they have to provide good services to the customers and attract more customers to the business. Another thing is fair prices will attract more customers than being greedy for making abnormal profits.

 

[Donkiz]

Business is all about satisfying the needs of your customers, if you are able to identify what the customers need, and find a means to proffer solution to the problem/need, then your business is bound to be successful.

The profit of a business or organization is not dependent on the size of their building, or the beauty of their ambience, or the size of their workforce, but on the number of customers they have, and the amount of business transactions they are able to consummate.

 

[Seyesystem]

There are a lot of factors that determine the profit of an organisation size doesn't matter when it comes to profit-making in business organisation. A small business that is where manage and concentrate on quality of the product produced and with effective communication with the existing and potential customers will help the business in achieving I increase in the profit of the organisation a big organisation that is well structured and where manage will definitely make I increase he sale of the products offering to the customers and this we eventually increase the profitof the organisation. There are many factors that determines profit of the organisation some of the factors are: offering quality products, effective communications with the existing customers and potential customers, establishment of good marketing department in the organisation, put in place effective internal control system in the organisation, having full knowledge of the business that you are going into and proper management and monitoring of the day-to-day activities of the organisation.

 

[Adetayo100]

Some few factors that determines the cost of productions are Number of Production Units. The most basic factor affecting profit in any business is the number of production units. Production per Unit. The productivity of your land and livestock also has an impact on profit. Direct Costs. Value per Unit Enterprise Mix.

 

[Kendy]

Several factors also determine the profitability of business and these ranges from; location, good management, feasible business plan, good customer relationship, creativity and innovation. The location is very vital in promoting the profitability of a business, the location should always be given topmost priority because this is where you can access your target audience. Location can either impede or skyrocket the business, so a business owner should always be strategic about it and not settle for the less.


Good management is very necessary in business, this is because even though the location is feasible yet the management and the techniques adopted is poor or faulty, then such business would face decline. Good management should be given prominence in business to avoid excessive and unnecessary spending of money. The funds should be managed even though it is in abundance to help out in unforseen circumstances. A good manager can make his little funds to become substantial funds but an incompetent manager would always look for excuses to spend funds haphazardly and blame the shortage on the economic situation of his Country. Creativity and innovative ideas like rebranding and promos could always spark up sales and boost the business growth.

One other factor that determines profitability of a business is satisfying the needs of the customers because the customers are the key root to success of any business or organisations.

 

[Kingsley]

Although the amount of capital we invest in the business will certainly have a role to play in how much we are likely going to make in the busines, hence the higher the capital we invest, we could safely say the higher the profit. There are other parameters that we can also use to project the profitability index of a business, and somany accounting ratios. But all in all there are other physical factors that can affect the profitability of a business. Like the attitude towards the customers, which can be seen as customer relations, although we commonize it as if it doesn't really count. The truth is customer relations is key in retaining sales and even increasing sales volume. I have seen people travelling from one state to another just to buy stuffs in another state all because of the customer relations they have in that particular state . The way and manner we handle our customers will determine if they will return back to us to buy more or if they will decide to go to our competitors. We need to be more customer friendly in dealing with our customers, and somtimes we can take out time to enquire from them if they are okay with the product or services.

 

[Sotherefore]

Thanks for sharing location is always the main determinants of a business's success that is why proper analysis of the location a person is establishing a business is absolutely necessary because without this in place the possibility of succeeding in a business may likely be very low..

If I am to establish a business I will make sure the location I needs to established the business has a large number of people that will be interested in the product I have to offer . some people may not likely to check all these things and put them into consideration that they will mostly be interested in the profit of the business.

Another thing that can also determine the profitability of a business is the type of products you are offering , if you are selling edible products and mostly beauty products I believe there will be high demand for this product in a crowded location compared to use selling other products like mechanical part or something similar , people will always eat and people will always wear clothes.

A lot of business also need strategy and if proper strategy is applied in a business the possibility of succeeding will be on the high side.

 

[eldavis]

Location has always been my favorite when it comes to factors that determines the growth and success of a business. Location is one of the things most business owners do not take seriously, they tend to look for places with less competition, hoping to succeed there, when what they should be after is their target audience.
You could place your business in a place with less competition and still not make profit, simply because you have no access to your target audience. Before deciding in a location for your business, it would be best to know your target audience and where they can be found, this should be what influences your decision more.

 

[Chibson]

Definitely, any business that focuses on satisfying the immediate needs of the people in its locality will definitely make a whole lot of profit. one of the best ways of making a lot of profit from her business is to know the needs of the people in your environment and look for ways of solving their problems then, boom you're on your way to making a whole lot of money. This is one of the smartest methods people use to make you a lot of money. Take for example during the coronavirus pandemic lock down a lot of people made money selling face masks. this is because it is an immediate need of everyone and if you can venture into such a business you will definitely be making a whole lot of profit. sometimes the size of a business does not determine the profit of the business but most times it does. There are small businesses you may think that they are not making profit but the reverse is definitely the case because a small business can be making large profit much more than the big businesses you see. It's all about knowing the needs of the people in your location and satisfying them properly.

 

[HayKay]

A lot of factors can contribute to varying profits in business not least that's limited to cost of the raw materials needed - cheaper raw materials can lead to higher profits in some situations.
Another thing that can lead to this is the competition that's around the business. Low competition can lead to Monopoly and or high profits.
Value of market share can also determine how profitable your business would be as well as customer base strength especially those who're loyal to your business mad brand.

 

[Abigael]

The size of a business is truly not the only thing that determines whether they make profits or not. There are so many factors that apply too. One of them which is very important is the business being able to satisfy people's needs. People will always patronize businesses that offer what they need. That makes businesses earn profits well. So a business should focus on looking for people's problems and solving them through a business so as to earn profits.

Another factor that determines the amount of profits earned is the location where the business is set up. You would not earn profits in an area where your potential customers are scarcely populated. For example selling pork meat in an area made of 90% Muslims. They don't eat pork, so you won't be making profits. Therefore, a business person needs to locate a business in a place where it is densely populated by people who need your products or services.

Lastly, a business needs to be run really well so as to make profits. A business person should understand so well where profits come from so as to tap into it. For example, a trader needs to know that the profits comes from buying goods from the supplier at a low price and selling it to consumers at a high price.