
Profitability, Profitability, also known as earning power, is the generic term for a company's ability to generate profits. It is the decisive measure of economic success and long-term viability. A company can be liquid and solvent, but if it is not profitable, it will consume its equity in the long term. Profitability is measured using a variety of key figures that put profit figures in relation to other values such as turnover, capital or costs. The most important key figures include margins such as Gross margin, the EBIT margin and the Net margin (return on sales), which highlight the earning power at various levels of the income statement. There are also return on capital ratios such as return on equity or return on assets. Increasing profitability is the core objective of entrepreneurial activity. The data required to achieve this is analysed in real time in the SAP Business One Cockpit visualised and monitored. For strategic corporate planning, specialised controlling tools such as the Versino Financial Suite Comprehensive planning and analysis functions.
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