English | 2013 | ISBN: 1430263075 | 240 pages | PDF + EPUB | 4,5 + 3,6 MB
Business of all sizes have a problem: How do you knowâ€”in real timeâ€”whether you are earning the profit you need to grow or even just stay in business? And which products or services are doing the â€œheavy liftingâ€ in contributing to profit?
Financial statements tell only part of the story. They are backward looking, for one thing, and they generally show results only in the aggregate. Worse, they never seem to reflect the hard work youâ€™re doing on a daily basis. As one manager said, â€œIf Iâ€™m adding 25% profit to every job, why am I getting barely 5% net profit at the end of the year?â€
Improving Profit: Using Contribution Metrics to Boost the Bottom Line solves this dilemma. As this book shows, Contribution-Based Activity (CBA) measures focus on two key levers that are fundamental to the operation of any business: financial contribution and units of activity. Knowing how to use these levers gets your company off the treadmill and on your way to stellar profitability. And as the 21 case studies show, CBA is surprisingly easy to apply to businesses of all types and all sizes.
What is â€œfinancial contributionâ€? Simply the amount above and beyond the cost of goods or materials sold that contributes to covering overhead and creating profit. As entrepreneur, business consultant, and professor Keith Cleland shows, few managers actually know the financial contribution their products and services make, nor how to amplify that contribution by incremental adjustments to one or both levers. As youâ€™ll learn, the financial tool Cleland created, TARI (Target Average Rate Index), provides insight into each productâ€™s value. Youâ€™ll not only learn which products are contributing the most to the bottom line, but how to unlock the profit potential in run-of-the-mill products or services. Improving Profit will help you:
â€¢ Restore and boost profit levels for your entire operation
â€¢ Relate your daily efforts to a transaction's actual profitability
â€¢ Focus on the two key performance indicators that can help you identify and solve problems affecting finance and productivity
â€¢ Help everyone in the companyâ€”from CEO to janitorâ€”understand how their activities help or hinder the companyâ€™s fortunes
â€¢ Make effective financial decisions
If youâ€™ve ever wondered why your results donâ€™t match your hard work, hopes, and dreams, read this book. As the case studies make clear, identifying and applying TARI results in a significantâ€”and often dramaticâ€”boost to the bottom-line.
What youâ€™ll learn
Readers will learn to:
â€¢ Improve the profitability of a job, product, service, or department
â€¢ Price products and services correctly
â€¢ Conserve cash and avoid financial crunches
â€¢ Win desirable quotes and tenders
â€¢ Identify and track productivity
Who this book is for
This book is for business managers, directors, consultants, students, professors, CPAs, and business advisers of all types.
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