+55 (11) 3254 1926
LOGIN
us
  • pt-br
  • en
  • es
  • fr
  • polaind
  • Products
    • Express
    • Corporate
  • Solutions
  • Partner Program
  • Events
  • About
  • Blog
TALK TO US
  • Products
    • Express
    • Corporate
  • Solutions
  • Partner Program
  • Events
  • About
  • Blog
TALK TO US
X
+55 (11) 3254 1926
EXPRESS
CORPORATE
SOLUTIONS
PARTNER PROGRAM
EVENTS
ABOUT
BLOG
TALK TO US
pt-br en es fr

polaind

BLOG

Categories

Cost Management
Costs and Expenses Reduction
Management
Others
Processes
Profitability

MORE RECENTS

19
Jul
MyABCM Costumer: Arca Continental
14
Jul
By integrating with SAP HANA®, MyABCM Cost Management and Profitability solution delivers powerful tools that improve profitability and shareholder value
12
Jul
MyABCM Costumer: Corporación Maresa

Have you ever heard of an ideal Profit Margin? Learn how to determine it!

One of the main objectives of entrepreneurs is to ensure the performance and sustainability of their business. This is achieved in several ways, such as investing in technologies and improving the internal management. In a practical way, we can use the profit margin control as an example of a business growth strategy.

This topic refers to the correct and safe planning of the determination of service costs and product pricing in order to obtain an ideal revenue ratio. To carry it out consistently and correctly, you need to understand some factors that influence this issue. A good understanding of the market and your business’s niche contributes a lot to the success of the profit margin.

Even though it is an important topic, many managers still do not know how to deal with it. To help you, we have prepared this article containing the main tips on how to determine the ideal profit margin for your company. Read on!

Observe competitors

The first tip is to observe how the market related to the industry in which you operate is doing. Conduct a survey on your competition’s pricing and service terms. This should be a comprehensive analysis, aimed at understanding aspects such as frequent promotions, consumers’ average purchase ticket, level of quality of the competition’s services, etc.

These data will allow you to direct your choices in the most appropriate and secure way, based on external guidelines. Keep in mind that the stipulated profit margin should be in line with the reality of your business and the consumer audience around you.

Invest in technology

The technological advances in the business environment have been quite significant in recent times. Companies that do not follow this trend miss out on great opportunities and even become stagnant in the business. As for the profit margin, there are already several products and tools that allow a better view of your expenses and investments – with this functionality, management software effectively help you control earnings.

Reduce costs

The calculation of profit margin is quite simple: add up all the expenses of a service or product and subtract from the selling price. Let’s suppose that a good requires $40 to be manufactured and another $30 to be marketed. When you sell it for $100.00, you will have a profit margin of $30.00.

Furthermore, the percentage of profit margin is found by dividing the profit amount by the selling price of the product – in this case, 30%.

With this understanding, we can see that the reduction of the costs involved in the production and sales process contributes to a positive profitability. Therefore, eliminate all those expenses that are not essential for marketing your business’s services.

These were the main information about how to determine the profit margin in your company – it is clear that technology has a major role. Companies like MyABCM offer several solutions that greatly help your business to obtain good profitability results.

Did you like the article and want to know more about our services? Then contact us and talk to one of our consultants!

Talk to MyABCM

Request a demo bellow and know what MyABCM can do for your company.

If you are interested in MyABCM solutions and need more information, please send us a message.

Sign up for our newsletter and access a world of efficiency and profitability in business.​

Click here
FOLLOW US
Privacy
LINKS
EXPRESS
CORPORATE
SOLUTIONS
PARTNERS
EVENTS
ABOUT
CAREERS
CASES
BLOG
CONTACT
OFFICES
BRAZIL
AFRICA
ARGENTINA
BALTICS
CHILE
CHINA
COLOMBIA
DACH
FRANCE
MEXICO
NORDIC
POLAND
URUGUAY
USA
Available-on-SAP-Store-White-BG-Wallet
© MyABCM. All rights reserved.

This site uses cookies to improve your browsing, the data is stored for analysis and production of content tailored to your interest. By clicking accept you agree to store cookies on your device.

MyABCM
Powered by  GDPR Cookie Compliance
Privacy Overview

This website uses cookies so that we can provide you with the best user experience possible. Cookie information is stored in your browser and performs functions such as recognising you when you return to our website and helping our team to understand which sections of the website you find most interesting and useful.

Strictly Necessary Cookies

Strictly Necessary Cookie should be enabled at all times so that we can save your preferences for cookie settings.

If you disable this cookie, we will not be able to save your preferences. This means that every time you visit this website you will need to enable or disable cookies again.