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Business advice, tips and tricks from the SBB in Holyrood Business Park, Edinburgh

What is the Measure of Profitability?

What is the Measure of Profitability?

In cost accounting, profitability is an examination of the actual profitability of an enterprise’s output under a given set of circumstances. Output of an enterprise can be grouped into fixed assets, goods, services, locations, processes and/or sales. Under optimum conditions, the enterprise’s output should be able to cover all the costs it incurs in producing that output and still leave sufficient profits for the enterprise. Under normal circumstances, profitability is determined by the overall revenue performance of the enterprise. Under normal circumstances, revenue growth, operating income and expense growth are balanced on a continual basis. Revenue increases with the increase in production and service, and decreases with the reduction of production and service. Profitability, on the other hand, is determined by changes in the total amount of net profits, less the amount of total expenses. Net profits are reported under the heading of gross profit. The difference between gross profit and net profit, however, indicates the profitability or potentiality of the business operation. The difference is called the operating profit margin. An important concept in profitability is the difference between revenue coming in and revenue going out. If revenue is increasing, profit is increasing as well; conversely, if revenue is decreasing, profit is decreasing. A positive net profit margin indicates the possibility of profit growth. A negative net profit margin indicates the tendency to lose money. Therefore, a company’s net profit margin is an indicator of how much the company makes in profit and how much it loses in loss. For a business to have a firm understanding of profitability, management needs to perform profit and loss analysis, which is referred to as the analysis of both positive and negative margins. The most common of these profitability ratios is the operating margin, which compares cash inflows or expenditures against revenues

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Tech Disruptions that Benefit the Food and Restaurant Industry

Tech Disruptions that Benefit the Food and Restaurant Industry

One of the greatest changes brought about by what is often referred to as disruptive technology is that of blowing the playing field wide open and increasing much-needed competition. Because of tech disruption, someone whose relationship with the food and restaurant industry stopped with their harbouring of a passion for cooking can now turn that passion into a business that rivals the biggest names in the food services market. Here are the five tech disruptions that make it possible: Renewable energy Renewable energy only really becomes obvious as one of the disruptive technologies benefitting the food and restaurants industry if you actually think about it. Ordinarily one wouldn’t consider that something like being able to tap into an unlimited source of power can effectively allow you to churn out something like fresh and hot pizzas very quickly, in a cost effective manner. You’d otherwise have a mounting energy bill, for example. So it becomes about the product, unhindered by the would-be overheads and other such barriers to entry. The ride-sharing economy The various examples ride-sharing services probably very easily roll off the tongue, but their importance as a disruptive technology that contributes to the improvement of the food and restaurant industry is perhaps obvious. It’s worth mentioning though, because now it means more customers can order food online, from a variety of different restaurants, to accept delivery in an ever widening radius of locations. Restaurants and food outlets themselves don’t have to worry about catering to in-house delivery fleets, staff, etc. Both the restaurants or food outlets and the consumer benefit, with the potential for a third-party to benefit as well, by taking up an on-demand job as a delivery person. Social media Social media as a disruptive technology has long since evolved to form somewhat of a mainstream technology

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Top 3 Areas of Small Business Accounting That Small Business Owners Takes Money Out Of

Top 3 Areas of Small Business Accounting That Small Business Owners Takes Money Out Of

Business finances is the secret that many new businesses seem to know but often overlook. The first thing any new business should do is to set up a simple budget that covers all of their expenses and assets. By doing this, businesses can now start looking at their business finances in a more focused way. In short, business owners can now increase their chances of success by forecasting how they are going to spend their money. Many of today’s businesses are built upon some highly innovative and complex concepts. As such, it is no surprise that many of these businesses have exceptionally high finance requirements. Businesses therefore have to set their financial forecasts aside along with other non-financial requirements, and focus only on those matters that directly affect business profits. This is where proper business finances, financial planning, is so important. It is the backbone of any enterprise that wants to see its business thrive and succeed for many years to come. So, what exactly constitutes business finances? Well, it is the sum of all financial commitments of a business that are required to pay for the daily operations of the business. Most businesses have accounts receivable at the end of each month that have outstanding balances against them. This means that the company has outstanding cash obligations that must be paid before the customer can receive their goods or services. For this reason, this area of finance is known as accounts receivable financing. Now, business finances also include bank financing. Banks are financial institutions that lend money to businesses, usually in return for interests that are fixed. However, banks can also lend money for short-term loans, which are very useful in a number of circumstances. For example, every business owner needs money for expansion, and for that they may

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How To Get Started As A Self Employed Professional

How To Get Started As A Self Employed Professional

If you are sitting at your boring desk, daydreaming of starting your own business, then this is exactly the right article for you. You probably already know that starting a business can be such a daunting process needing tons of effort. But the big question always lingers in front of you: How hard can it really be? Actually, starting your own business can be surprisingly easy if you just put your mind to it and put aside all your worries. The secret lies in starting your own business based on a very solid plan. A business plan is what acts as your road map to success. It tells you how much money you need to get started and the target market you should choose. This guide also tells you how much time and effort you need to put in to make things work. A business plan helps you prioritize tasks and properly map out your steps towards success. Once you have your business idea, the next step is to find a great business idea or even better, a great product. Once you have both, the next step is to start researching your options. If you are starting from scratch, then this research will save you a lot of money and time. Start looking at what’s available on the internet. Most aspiring business owners spend the first two years completely immersed in their business idea. Some even spend up to four years doing so. While this path does help you learn a lot and get a lot of experience working under others and as independent workers, it does not guarantee success. Those who are successful usually got help from friends and family and got help in various ways such as grants, scholarships and tax incentives. There are also several federal grants

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Time Management Tips For Small Business Owners

Time Management Tips For Small Business Owners

Using every moment during the workday wisely is a vital component of success in any level of business.  Your operation’s efficiency is dependant upon your time management habits, and a good business is a poignant business.   You want to make sure business is done efficiently, but avoid cutting corners.  Business law can be unforgiving in some cases.  If you’re looking to improve the coalescent vibe in your business, take a moment of your time now to do a little research.   Here is a brief overview of some helpful tips for better time management in your small business.   Take inventory of how your time is spent Before you can better manage your time, you’ll need to take a thorough inventory of how the time is currently being spent.  If your business employs other professionals, you’ll need to take a closer look at how your office is being run. Identify the things which are interrupting the flow of business most often.  What are the biggest time wasters in your office? Cut down on personal emails, surfing the web, and other digital distractions.   Invest in boosting project management Adding structure to your operation’s project management regimen will boost efficiency, but you’ll need the best tools for the job.  Lucky for you, there are plenty of excellent software programs available to whip your project management technique into shape.   Some of the most popular software tools among business owners today include: Microsoft Project – If you have Office 365, then it’s only natural to work through Microsoft Project.  Plan out team schedules, run through scenarios, and collaborate with ease. Trello – Collaboration software which organizes projects into boards.  Trello has an easy to understand display, and provides flexibility as you work.   Base Camp – No task will slip through

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Why Do Small Businesses Need to Invest in SEO?

Why Do Small Businesses Need to Invest in SEO?

The business playing field is rarely in favor of small businesses. For instance, while small businesses employ around 47.5 percent of the private workforce in the United States (that’s almost 59 million people), not a lot of these businesses go on to be successful. For every 100 small businesses opened, only 80 will survive the first year, 40 will survive until their fifth year, and only 13 will live to see their 10th anniversary. As a business owner, you definitely want to be one of those 13 that survive operations for as long as possible. One of the best ways to achieve that in the current setup is to go digital, starting with investing in a website. It would then be of importance to have this website gain some traction and traffic through optimizing search engine results by using professional SEO agencies similar to Victorious and others that can be of service to you. Here’s why an SEO-friendly website is necessary for small businesses to operate successfully. Stay Visible for Consumers Consumer behavior has changed over the last few years, and now that the internet has made information more accessible, more people are using it to find businesses that satisfy their needs and preferences. For instance, 87 percent of shoppers begin their shopping process by searching for products online before going to their target online or physical stores. And around 84 percent of shoppers believe online reviews as much as they believe personal recommendations. To take advantage of this consumer behavior, your business’s website must be visible to consumers looking for your business and products, as well as provide enough information to fulfill their research needs. Otherwise, two things could happen: either you don’t convince them to do business with you, or they don’t find your business in the first place. By implementing SEO on your website, you stay visible for

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