Introduction

The enterprise is the main link and one of the subjects of the economy. Today, there are many enterprises that specialize in a wide variety of activities and production and have their own structure. However, all of them, in the end, have a common goal - to generate income, namely profit. The priority role of profit arose with the advent of such a phenomenon as a market economy. Tough market conditions force enterprises to develop, compete and hold their positions.

The level of profitability of the enterprise shows the efficiency of the entire structure and all levels of production. An enterprise is a complex mechanism where everyone performs their function. This mechanism continuously interacts with the external environment, but at the same time it has internal features. Effective managers are able to analyze the influence of all factors and offer the most rational ways to improve the efficiency of the enterprise.

Question: What are the ways to increase profitability? - excites any manager, owner, leader. As long as the enterprise brings income to its owner, it continues to function, which means that such a topic as ways to increase profitability will be relevant throughout the market economy.

At the same time, the following are not recognized as income: amounts of value added taxes, excises; receipts under commission agreements; advances and deposits, advance payment.

In this course work, the primary goal is to characterize the methods of increasing the profitability of the enterprise. To achieve the goal and a deeper understanding of the problem, it is necessary to complete the following tasks:

)present and consider profitability indicators: profit and profitability of the enterprise, their types and significance;

)to study the external and internal factors affecting the income of the enterprise;

)characterize the existing ways to increase the profitability of the enterprise.

1. The concept of enterprise profitability

.1 Profit as an absolute indicator of profitability

income profit profitability

Commercial activity is not complete without such a category as profit. The very word "commerce" is already closely connected in the minds of people with this concept. The classic and simple definition of profit is as follows: profit - is defined as the difference between total revenue and total costs.

Before organizing any commercial activity, an entrepreneur tries to calculate how profitable, which means that this project will be profitable, since making a profit is the main goal of any commercial organization. However, from the point of view of the Anglo-American financial school, which has received worldwide recognition, the priority in the activities of the enterprise is specifically the maximization of the income of the owners. This is due to the need for optimal distribution and use of the company's financial resources to ensure maximum market value. Such a rational approach will ensure the income of the owners.

The enterprise has different directions of profit distribution (Fig. 1.1) In turn, the income of the organization is recognized as an increase in economic benefits as a result of the receipt of assets (cash, other property) and (or) the repayment of obligations, leading to an increase in the capital of this organization, with the exception of contributions from participants ( property owners). Only part of the profit remaining after paying taxes and payments to the budget is directed to the development of the enterprise and is called net profit.

An enterprise may have revenue, but this does not mean that it also receives profit. To identify the financial result, it is necessary to compare revenue with the costs of production and sale, that is, with the cost of production. The company makes a profit if the revenue exceeds the cost. In a situation where revenue is equal to cost, it is only possible to recover the costs of production and sale of products. The costs for the purchase and delivery of raw materials are covered, wages are distributed to workers, but there is no profit in this situation, but the enterprise has no debts. If the costs exceed the revenue, then the company receives a loss, a negative financial result, which puts it in a difficult financial situation, debt obligations, and bankruptcy is not excluded. Naturally, the organization seeks to improve its position as quickly as possible and rehabilitate itself in the market as much as possible.

So we see that profit is a kind of benchmark for the enterprise and has a number of functions. In addition to the fact that profit characterizes the economic effect, it also performs a stimulating function, since it is the basis for expanding production, scientific, technical and social development, and material incentives for workers. Also, profit is one of the main sources of formation of budgets of different levels.

Profit is an absolute indicator of profitability, since absolute indicators allow us to analyze the dynamics of various profit indicators over several years. At the same time, it should be noted that in order to obtain the most objective results, indicators should be calculated taking into account inflationary processes. Profit is formed from several components:

§ profit from the sale of products (sales) P R is the difference between sales revenue R and the costs of production and marketing of products (full cost) etc , the amount of value added tax (VAT), excises AKC:

P R = B R - Z etc - VAT - AKC.

§ profit from other sales (P etc ) is the profit received from the sale of fixed assets and other property, waste, intangible assets. Defined as the difference between sales revenue (B etc ) and the costs of this implementation (Z R ):

P etc = B etc - Z R .

§ profit from non-operating operations is the difference between income from non-operating operations (D ext ) and expenses on non-sales operations (Р ext ):

P ext = D ext - R ext

It is worth noting that a distinction is made between accounting and economic profit. Economic profit is the difference between total revenue and external and internal costs. Profit, determined on the basis of accounting data, is the difference between income from various activities and external costs.

In a market economy, it is necessary to properly manage profits, use it not for consumption, but for investment, innovation and maintaining competitiveness. The amount of profit depends on the production, supply, marketing and financial activities of the enterprise. Such an indicator as profit says a lot about the efficiency of the enterprise, but there is also the concept of profitability. It is associated with the relative expression of these indicators and plays a role in the analysis of the enterprise. Profit and profitability of the enterprise are directly interconnected.

1.2 Profitability as a relative indicator of profitability

To assess the effectiveness and economic feasibility of the enterprise's activities, it is not enough just to determine the absolute indicators. A more objective picture can be obtained with the help of profitability indicators. Profitability indicators are relative characteristics of the financial results and performance of the enterprise. Profitability comprehensively reflects the use of material, labor and financial resources.

Profitability indicators are used for a comparative assessment of the performance of individual enterprises and industries that produce different volumes and types of products. The most commonly used indicators are the profitability of products and the profitability of production.

Product profitability (P P ) is the ratio of the total amount of profit to the costs of production and sales of products (the relative amount of profit attributable to 1 ruble of current costs):

R P \u003d (C-S / C) * 100,

where C is the price of a unit of production; C is the unit cost of production.

The profitability of production (total) shows the ratio of the total amount of profit to the average annual cost of fixed and normalized working capital (the amount of profit per 1 ruble of production assets):

R about =P/(OS Wed + O b With Wed )*100,

where P is the amount of profit; OS Wed - average annual cost of fixed assets; O b With Wed - average annual balances of working capital.

Profitability characterizes the efficiency of the production and economic activities of the enterprise, reflecting at what amount of capital used this mass of profit was obtained. With the help of product profitability, the efficiency of production of certain types of products is evaluated, and the profitability of production, or the overall balance sheet profitability, serves as an indicator of the efficiency of the enterprise (industry) as a whole.

There is a concept of profitability of turnover. This indicator reflects the relationship between profit from product sales and sales revenue.

The profitability of personnel shows the ratio of (net) profit to the average headcount.

Profitability of sales - profitability ratio, which shows the share of profit in each earned ruble. Return on sales is an indicator of a company's pricing policy and its ability to control costs. It is often used to evaluate the operating efficiency of companies.

In addition to the fact that the profitability indicator is one of the main criteria for evaluating the effectiveness of the enterprise, it is also a productive, qualitative indicator of the enterprise. The growth of profitability helps to increase the financial stability of the enterprise, ensures the victory of the enterprise in the competition and contributes to the survival of the enterprise in a market economy. For entrepreneurs, the profitability indicator characterizes the attractiveness of a business in this area.

The most general assessment of the effectiveness of profit formation is the return on assets (economic profitability). Enterprise assets - a set of property rights belonging to the enterprise, in the form of fixed assets, stocks, financial contributions, monetary claims to other individuals and legal entities. In other words: assets are investments and claims. The term "assets" is also used to refer to any property, property of the organization. Return on assets characterizes the overall level of profit received from the use of all assets of the enterprise:

R a =P b /A*100,

where Pb - accounting profit; A is the average cost of all assets used.

Profitability indicators are used in assessing the financial condition of the enterprise. However, the profitability can be calculated for the country as a whole, for example, you can get acquainted with the average profitability of goods sold, products, works, services and the profitability of the assets of organizations by type of economic activity, in percentage terms, referring to table 1. (Appendix 1).

Profit and profitability are the most important indicators for economic entities, so it is not surprising to strive to improve these indicators. These indicators depend on both the internal and external environment, and entrepreneurs are forced to take this into account.

2. Factors affecting the profitability of the enterprise

.1 Internal factors

In the literature, the word "factor" is interpreted as the driving force of an ongoing process or one of its necessary conditions. Internal factors are those that depend on the enterprise itself, i.e. the enterprise can influence them, because she creates them herself.

Internal factors are very diverse, therefore, for a better understanding, analysis, accounting and identification of production reserves, they are combined into the following groups:

1)the level and competence of the management;

2)technical level of production;

)level of organization of production;

)incentive system;

)development of the marketing system;

All internal factors can be divided into objective and subjective. Objective ones arise regardless of the subject of management (for example, the deterioration of mining and geological conditions at a mining enterprise or natural disasters). The subjective ones, which make up the absolute majority, are completely dependent on the subject of management and should always be in the field of vision and analysis.

Let's take a closer look at some internal factors.

The competence of the management is the first point in the internal factors deservedly. No business is complete without leadership. Often an enterprise does not succeed due to the lack of experienced, enterprising management, and effective management always gives its positive results. The head of the enterprise must have full knowledge of the information and be able to manage it. So the rest of the internal factors depend on the "top" management, for example, how actively the innovation policy will be carried out, which can open up great opportunities for the development of the enterprise, increasing the technical level and competitiveness. All modern economic theories indicate that innovations are a source of development only if they are actively and effectively used, as well as creating a favorable environment for their initiation.

The leader can significantly affect the nature of interpersonal relations in the work team, the attitude towards joint activities, satisfaction with the conditions and results of work, i.e. socio-psychological climate, on which the effectiveness of the organization as a whole largely depends.

The level of organization, the system of incentives and marketing (systematized activities related to the development, creation and sale of products to meet personal and social needs) all this also applies to the internal environment of the enterprise. The internal environment of the enterprise is people, property and information. The result of the interaction of these elements is the finished product.

It is difficult to argue with the fact that the basis of the enterprise is people, their efforts and knowledge. In this regard, the stimulation of employees has its immediate impact. A significant role is played by bonuses for rationalization and inventive activity, which leads to an increase in the profits of firms. Prospective specialists are stimulated not only through monetary rewards, but also through benefits and free services from social consumption funds. Large organizations pay their employees bonuses for the holidays on average in the amount of 25-50% of the monthly salary, the 13th salary; make payments for the next vacation; provide for personal use vehicles with payment for gasoline; fully or partially compensate for the cost of housing, etc.

On the other hand, for example, an employee who made a profitable deal for the company, who was not encouraged and appreciated, can simply leave the company, even go to competitors and take information with them. This threatens with losses for the company, accustomed to save on staff. Your reputation may also suffer from this. The firm will not be attractive to highly qualified specialists. The image of the company is something that should not be forgotten.

It can be concluded that the factors of the internal environment have a direct impact on the performance of the enterprise and on each other. For example, a change in technology may require staff training, changes in wages, etc.

Factors of the internal environment determine the production potential of the enterprise, but there are also external factors that indirectly affect the activities of enterprises and they must also be taken into account and, if possible, used in favor of the enterprise or minimized if their influence is not favorable.

.2 External factors

External factors are those conditions that the organization cannot influence, but external factors have a significant impact on its activities. You can call this phenomenon the external environment of the enterprise, which implies a variety of forces and subjects that have a direct or indirect impact on the functioning of the organization and operate outside of it. To survive, a firm must adapt to its external environment.

There are environmental factors of direct and indirect impact. A direct impact has such a factor as the population living in the vicinity of the enterprise, as it is the main consumer and supplier of labor. An important role is played by the supplier of production components, such as: material resources, technology and equipment and financial resources.

To select suppliers of material resources, it is necessary to analyze prices, terms of delivery and their capabilities. Also, due to an unscrupulous supplier, product quality may suffer, and this will affect consumer loyalty to the manufacturer.

Technique and technology are important in themselves, because the efficiency of production depends on the response of the enterprise to new technologies and their implementation. The providers of financial resources are banks, investment companies, funds, etc.

Consumers are the next direct impact factor. Consumers form the market. The company must know its customers and their needs, find ways to meet them. Consumers are considered in terms of pricing, the possibility of prepayment, the use of a system of discounts and other promotions.

Competitors also have direct impact. Competitors determine the operating conditions and the amount of profit diverted to create optimal conditions for work. In many cases, it is competitors, not consumers, who influence decisions: what to sell and at what price. Competitive struggle is conducted not only for consumers, but also material, financial and labor resources.

The profitability of the enterprise depends on how well the system of interaction with contact audiences is developed. It is precisely the timely analysis that can warn of impending changes in consumer preferences.

The state is a fairly powerful center for regulating economic activity. The state operates with regulatory legal acts, through the establishment of taxes, subsidies, tax rates, refinancing rates, subsidies and other instruments.

Much can be said about the influence of the state on the economy. For example, today there is an opinion that the Russian government should partially or temporarily exempt start-up, promising projects from income tax. It is believed that this measure will have a favorable impact on the development of small and medium-sized businesses. 45% of entrepreneurs consider it necessary to remove administrative barriers, and 47% consider it important to reduce the rate on commercial loans.

The state sets customs duties, for example, since September 1, 2015, Russia has reduced customs duties on almost 4 thousand items of goods. Import duties were mainly reduced on sanctioned goods. Because of this, in some cases, domestic producers may suffer. Thus, the reduction in rates affected several industries, including light industry and the industry of children's goods.

Here we also see the influence of the political situation on the ongoing policy in the field of the economy, and so we smoothly move on to factors of indirect influence.

There are environmental factors of indirect influence. These are political, economic, socio-cultural, demographic, international factors.

Political factors reflect the stability of transformations in the country, the number of political factions, and the criminal situation. The political situation and the investment climate determine the amount of investment in the country's economy.

It is known that exports in Russia determine the dynamics of industrial production by 37.6%. So in 2014, this figure was not very high (101.1%). This is due to the reduction in exports due to the imposed sanctions, which externally affected the activities of many industries.

The influence of the external environment can be considered on the example of the activities of a gold mining enterprise. To do this, let's refer to Table 2 (Appendix 2) "Opportunities and Threats of the External Environment Affecting the Activity of Gold Mining Enterprises".

The table shows the impact on the activities of the enterprise of the political situation, state legal regulation, the level of prices for products, the level of investment attractiveness of the industry. Each enterprise has its own specifics when interacting with both the external and internal environment. However, every enterprise strives to increase profitability, and in the next chapter we will talk about ways to achieve an increase in enterprise income.

3. Ways to increase the profitability of the enterprise

An organization's income is recognized as an increase in economic benefits as a result of the receipt of assets and the repayment of liabilities, leading to an increase in the capital of this organization, with the exception of contributions from participants.

The costs of production and sales of products determine the level and structure of its cost. Quantitatively, it occupies a significant share in the price structure, so the cost reduction has a very noticeable effect on profit growth, all other things being equal.

An enterprise can reduce the cost of production if it starts using cheaper raw materials, but in some cases this may affect the quality of the product, and hence the demand for it. Choosing a cheap material, the manufacturer risks the location of the consumer, so you should pay attention to such a way to reduce the cost of production as the modernization of the production process.

The decisive condition for cost reduction is continuous technical progress. The introduction of new technology, comprehensive mechanization and automation of production processes, the improvement of technology, the introduction of progressive types of materials can significantly reduce the cost of production. Businesses can find efficient ways to use production waste.

Rationalization of the use of available resources, including the labor force: raising the level of skills of workers, ensuring outstripping growth in labor productivity compared to the average salary will also give results. Compliance of the qualifications of employees with the level of technologies used is extremely important, otherwise expensive equipment may not be justified, and its utilization rate will be low.

It is known that in the 1990s from 52 to 76% of enterprises were engaged in innovative activities. Including, from 31 to 46% of enterprises applied product innovations, from 15 to 33% - technological innovations. .At the beginning of the XXI century. these parameters have changed - a greater number of enterprises have begun to apply technological innovations (up to 51%), much attention has been paid to new approaches to the management system and the formation of personnel quality.

Increasing the production of products and raising their prices by improving the quality, improving the means of production. This may also be related to NTP.

Indeed, an increase in sales volume in physical terms, other things being equal, leads to an increase in profits, but a corresponding increase in production volumes requires additional investments and, therefore, the company's own funds or an available long-term loan.

Reducing the cost of production and sales of products can be achieved using a favorable location, for example, the proximity of the enterprise to the fields allows you to reduce transportation costs. Increasingly, manufacturers prefer to have their own point of sale - their own store.

Diversification of production, that is, expansion of the range, development of new markets is an important stage in the development of the enterprise and is supported by the desire for economic benefits. Here we can also note the importance of focusing on the consumer, because the range is adjusted to his needs. The principle of customer orientation is manifested in understanding the needs and expectations of consumers, measuring customer satisfaction and results of actions. Organizations depend on their customers and therefore must meet customer requirements and strive to exceed customer expectations. Characteristics of client segments, drawing up a portrait of the consumer is a stage in the development of an enterprise strategy.

In order to obtain greater profits and increase profitability, an enterprise can also rent out part of its property, including premises, structures, equipment, etc., for a more or less long term lease. The lease of property may result in the form of a lease-to-own. As a result, the company receives income that increases non-operating income and gross profit. But this method is not connected with the development of the enterprise.

Conclusion

So, there are several ways to increase the profitability of the enterprise. They are associated with a reduction in the cost of production and production costs, with the expansion of output and pricing policy, working with consumers, and of course with technical progress. The management of the enterprise chooses the most effective methods based on the specifics of the organization. Management decisions are influenced by many factors, which are divided into external and internal. If it is possible to influence the internal environment, then the influence from the outside must either be minimized or used to the advantage of the organization.

When choosing a strategy to increase profitability, first of all, such indicators as profit and profitability are analyzed. There are various forms for calculating these quantities. Profitability shows how profitable the activity of the enterprise, respectively, the higher the profitability ratios, the more efficient the activity. Profit - is defined as the difference between total revenue and total costs. The successful development of the organization in the long term depends on the timeliness of the analysis, the reliability of the results obtained and the promptness of the development of measures aimed at increasing profit and profitability indicators.

Currently, to increase profitability and profitability, such methods as increasing sales and reducing costs are most often used, and more and more companies are paying increased attention to marketing (working with the consumer), which allows them not only to choose products that are of interest to consumers, but also to promote them to the market.

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Yield indicators:

1. The sum of all income of the enterprise (thousand rubles):

∑∂ = 2110 + 2310 + 2320 +2340 ± 2430 ± 2450 ± 2460

2. Return on assets:

Shows how much the company received total income from each ruble invested in assets.

3. The sum of all expenses:

∑ρ = 2120 + 2210 + 2220 + 2330 + 2350 + 2410 ± 2430 ± 2450 ± 2460

4. Profitability of expenses:

where is profit before tax.

Shows how many kopecks of total profit the company receives from each ruble of total expenses.

5. Profitability of expenses:

If a< 1, то финансовый результат убыток.

6. The share of revenue in the composition of total income:

Shows how much revenue is in the composition of all received income of the enterprise. If > 50%, this means that the company receives income related to the operating activities of the enterprise.

Business Activity Indicators

In a broad sense, business activity means the entire spectrum of the firm's efforts aimed at promoting it in the product, labor, and capital markets. In a narrower sense, business activity is expressed in the dynamic development of the organization, in the speed of achieving its goals.

In the financial aspect, business activity is manifested, first of all, in the turnover of the property of the enterprise and its components.

Turnover is characterized by two indicators:

The turnover ratio shows the number of turnovers that the assets of the enterprise and its components made during the analyzed period;

The period of full turnover is the average period for which the company returns the funds invested in assets and their components.

1. Turnover of assets (property, capital).

1.1. Asset turnover ratio (property, capital):

where AT- revenue;

Average value of assets;

The average value of the property;

The average value of capital.

1.2. Period of full turnover of assets:

where D- the analyzed period in days.

2. Turnover of current assets.

2.1. Current assets turnover ratio:

where is the average value of current assets.

2.2. Period of turnover of current assets:

Attraction (release) of current assets as a result of slowdown (acceleration) from turnover:

where t1 and t0- the period of turnover of current assets of the reporting and previous years.

The result with a minus sign indicates the acceleration of the turnover of current assets and their release from circulation. The result with a plus sign indicates a slowdown in the turnover of current assets and their additional attraction into circulation.

3. Inventory turnover.

3.1. Inventory turnover ratio:

where s pr.- cost of sales;

Average inventory..

3.2. Inventory turnover period:

4. Receivables turnover.

4.1. Accounts receivable turnover ratio:

where is the average value of accounts receivable.

4.2. Accounts receivable turnover period:

This indicator tells how many days, on average, debtors repay their debts.

5. Accounts payable turnover.

5.1. Accounts payable turnover ratio:

where - the average value of accounts payable;

Full cost of sales.

5.2. Accounts payable turnover period:

This indicator tells how many days, on average, the company repays its debts.

HELL. Sheremet, as part of the analysis of business activity, recommends calculating the return on assets.

1. Capital productivity of fixed assets:

where AT- revenue;

The average value of fixed assets according to form No. 5 ..

This indicator tells how much revenue in value terms the company receives from each ruble invested in fixed assets.

2. Return on assets of the active part of fixed assets:

This indicator tells how much revenue in value terms the company receives from each ruble invested in machinery, equipment and vehicles.

Also, for the analysis of business activity, the ratio of receivables and payables is considered.

Other indicators are calculated:

1. The duration of the operating (production and commercial) cycle:

Shows how many days, on average, the financial resources of the enterprise are immobilized in stocks and receivables.

2. The duration of the financial cycle:

Among the qualitative indicators of business activity are:

1. current performance:

1.1. the presence of stable buyers and suppliers;

1.2. the breadth of markets for products;

1.3. product competitiveness;

1.4. business reputation;

1.5. impact on industry or regional price levels;

2. qualitative perspective indicators:

2.1. acquisition of new high-tech equipment;

2.2. modernization of production technology;

2.3. attraction of highly qualified personnel;

2.4. active participation in government programs and obtaining promising profitable orders.

To characterize business activity, the coefficient of sustainability of economic growth is calculated:

where P- profit;

dip- dividends and interest on securities;

The average value of own capital.

This coefficient shows the rate at which the equity capital increases or decreases in the course of the economic activity of the enterprise.

How to evaluate the level of profitability using the analysis of absolute and relative indicators?

How to conduct a detailed analysis of the cost structure by cost items?

How to increase the level of profitability of the enterprise?

The profitability of an enterprise is an indicator that directly affects profit, that is, the final result of the activity of any enterprise. Increasing the profitability of the enterprise is one of the main goals of the management of any enterprise. There are many ways to increase profitability, each company chooses the most suitable for a particular company. Let's consider the main methods of increasing profitability and see what impact they have on the final result of financial and economic activity.

In order for the company to be profitable and take a stable position in the market, it is necessary:

• produce products that are in demand. You can produce a lot of products, but if there is no demand for it, then there is no point in such production;
• sell products at the price that corresponds to the average market price and at which potential consumers are ready to purchase this product. To set such a price, the company's specialists must study the sales market, potential consumers, their needs and paying capacity, the competitiveness of the enterprise and the prices of competitors for the same type of product;
• produce products in the quantity required by the market so that the product does not stay in stock, especially if it has a limited shelf life;
• to produce products with a rational calculation of production costs. When production costs exceed the proceeds from the sale of products, production is considered unprofitable and unprofitable, it does not make a profit. This can lead to bankruptcy.

We estimate the level of profitability

Profitability assessment involves the analysis of absolute and relative indicators characterizing its level.

The absolute indicator is profit. Due to it, the enterprise can increase the wage fund, expand and increase production turnover, finance other activities, and so on. In general, profit is the difference between the cost of selling a product and its cost (the sum of all costs spent on manufacturing this product).

The amount of profit can be found from the financial statements, namely from the income statement (form No. 2).

Consider a fragment from the financial statements for 2016 of Alfa LLC, which manufactures chairs (Table 1).

Table 1

Statement of financial results for 2016

So, the revenue of Alpha LLC for 2016 from the sale of 4640 chairs at a price of 24,000 rubles / unit. - 111,360 thousand rubles. Production and sales costs amounted to 89,494 thousand rubles.

We subtract the full cost from the proceeds and get a profit from the sale - 21,866 thousand rubles. Net profit (net of taxes and other expenses, the main indicator of the effective functioning of the enterprise) is 17,493 thousand rubles.

When analyzing absolute figures, net income is not the only thing worth paying attention to. No less important is the ratio of sales revenue to the cost of production.

If the values ​​of the cost of production and the proceeds from its sale are approximately equal, the enterprise will receive little profit, so one should strive to obtain more revenue at lower costs. Thus, we can conclude that an enterprise can be considered profitable if its proceeds from the sale of products are sufficient to cover all the costs of production and sale of products and to form a difference, i.e. profit.

After the absolute indicators of profitability, we analyze the relative indicators - profitability, i.e. indicators of the economic efficiency of the enterprise.

Product sales profitability (ROM, Returnon Margin) is the ratio of profit (loss) from sales to cost.

In our case ROM= 21,866,258.36 / 89,493,741.64 × 100% = 24.43%.

Important!

The higher the rate of profitability of product sales, the more efficient the production and sale of products, and hence the higher the competitiveness of the enterprise. To increase this indicator, it is necessary to reduce the cost of production and sales of products, to increase sales volumes.

Profitability of sales (ROS, Margin on sales) is the ratio of profit (loss) from sales to revenue.

In this example ROS= 21,866,258.36 / 111,360,000.00 × 100% = 20%.

As you can see, the values ​​of the indicators of profitability and competitiveness of the analyzed enterprise are quite large (the maximum minimum profitability is 5%).

The composition of the cost includes all the costs incurred by the enterprise for the production of this product and its sale. They are grouped into two major categories: conditionally permanent and conditional variables.

The first ones (Table 2) do not depend or weakly depend on the volume of production (for example, depreciation deductions, rent for premises, wages of personnel not related to the production of products, purchase of office supplies, information and consulting expenses, expenses for telephony, Internet, etc. ), the latter (Table 3) directly depend on the volume, i.e., they either increase with an increase in the volume of production, or decrease with its decrease (for example, the cost of raw materials and materials, wages of the main production workers, etc.).

table 2

Fixed costs for 2016

The amount of semi-fixed expenses for 2016 is 16,850,180.04 rubles. Regardless of changes in the volume of production, it will remain at the same level.

Table 3

semi-variable costs

Taking into account the norms for the consumption of materials and the cost of wages for the main production workers per chair, the amount of conditionally variable costs for the entire volume of production (4640 units) is calculated - 72,643,561.60 rubles.

The sum of conditionally fixed (16,850,180.04 rubles) and conditionally variable expenses (72,643,561.60 rubles) gives a cost estimate of the total cost (89,493,741.64 rubles; see also Table 1).

Calculate the allowable volume of production at which the enterprise will cease to be profitable, but will not become unprofitable - breakeven point.

Break-even sales volume is 2019 chairs. With such a quantity, the enterprise will not receive any profit or loss, and only starting from 2020 units. the company will begin to make a profit. In this case, the amount of conditionally fixed (16,850,180 rubles) and conditionally variable expenses (15,655.94 × 2019 = 31,609,342 rubles) is approximately equal to the amount of sales proceeds (2019 × 24,000 = 48,456,000 rubles). ), it is in this scenario that there will be neither profit nor loss.

The difference between the planned sales and the breakeven is called strength threshold. In our example, this is 2621 units. It is necessary to monitor this indicator and prevent it from approaching zero.

At this point, we cover all costs - both conditionally fixed and conditionally variable, and each next sold unit of production will bring approximately 8344 rubles. profit (24,000.00 - 15,655.94).

For greater clarity, we will draw up a break-even chart based on the initial data (Table 4).

In this graph, the values ​​of costs (total, variables) and revenue are located vertically, and the values ​​of sales volume are located horizontally. The graph shows that at the value of 2019 units. the lines of revenue and total costs intersect, which means that at this point their values ​​are equal.

For all values ​​of sales volume below 2019 units. the cost line exceeds the revenue line, therefore, the enterprise is unprofitable; at values ​​above 2019 units. the revenue line exceeds the cost line - the company makes a profit.

Methods for increasing the level of profitability

The main factors that a company can influence are increase in sales, increase in the cost of selling a unit of goods and cost reduction.

Option 1

We will increase sales from 4640 units. up to 5,000 chairs per year, subject to the demand for such a quantity in the sales market and maintaining the current number of employees without expanding production.

Revenue \u003d 5000 × 24,000 \u003d 120,000,000 rubles.

Semi-fixed expenses = 16,850,180.04 rubles.

Conditionally variable costs \u003d 5,000.00 × 15,655.94 \u003d 78,279,700 rubles.

Profit from sales = 120,000,000 - 16,850,180.04 - 78,279,700 = 24,870,119.96 rubles.

Conclusion

Having increased the volume of sales by 360 chairs and retained the selling price per unit, we received additional profit in the amount of 3,003,861.60 rubles.

Option 2

We will increase the cost per unit of production to 25,000 rubles. Other things being equal, the situation will be similar to the previous one. Revenue will increase and amount to 116,000,000 rubles. (25,000.00 × 4640) while maintaining the same level of conditionally fixed and conditionally variable costs.

Conclusion

In this case, the profit will be 26,506,258.36 rubles. (116,000,000 - 89,493,741.64), which exceeds the value of profit at a unit cost of 24,000 rubles. for 4,640,000 rubles.

Both in the case of an increase in sales volume and in the case of an increase in price, it is necessary to take into account the nuances. There are no guarantees that, for example, an enterprise will be able to realize an increased volume of production - it is quite possible that the market does not need such a quantity. And then the enterprise, which has already spent funds on the production of more products, which, moreover, could not sell, will have to bear the costs of organizing / renting a larger warehouse for finished products. And if the products are perishable, the company will also incur losses with such an increase in production. To avoid such situations, you need to carefully analyze the market and potential buyers.

As for the rise in the price per unit of production: when, other things being equal, the properties of the goods (quality, design, etc.) increase in its cost, buyers may refuse to purchase the goods. This situation can also be aggravated by comparison with the prices of competitors.

We found that the profitability of any enterprise is affected by a change in the balance of unsold products, as is the case with an increase in production volume with a constant sales volume. The rest (360 units that will not be sold) is the incomplete receipt of revenue, therefore, the non-receipt of profit with the funds already spent on the production of these 360 ​​chairs.

To increase the level of profitability and profitability, the company needs to reduce the balance of unsold products.

And finally, we turn to the most common way to increase profitability - reducing production costs. To reduce the cost of production, enterprises often develop methods and programs for the implementation of certain measures. But first, it is necessary to study the cost structure item by item and determine the specific weight of each item (Table 5).

Table 5

Composition and cost structure

In the price structure, the largest share is occupied by two cost items - "Material costs" and "Expenses for wages of the main production workers and insurance premiums". It is rational to start reducing production costs with them.

Ways to reduce costs under the item “Expenses for wages of the main production workers and insurance premiums”:

• reduce the number of employees (for example, by automating some processes);
• cut wages. But this may entail the departure of highly qualified specialists. Therefore, various motivation systems and progressive wage systems are usually used so that production workers perform a larger amount of work for the same wage level.

Option 3

We will reduce the number of key production workers by 10 people, subject to the automation of some production processes.

The total number of employees before the reduction is 80 people.

On average, each person per year under the item “Expenses for wages of the main production workers and insurance premiums” accounts for 617,940.12 rubles. (with an average salary of about 50,000 rubles). In the event of a reduction in the number of employees, the costs under this item will be 43,255,808.40 rubles.

But at the same time, new equipment will be purchased for automation, which will increase the cost item "Depreciation" by 10% and amount to 57,015.68 rubles.

Conclusion

The cost price will be 83,319,523.68 rubles, profit - 28,040,476.32 rubles.

The payroll cost item was reduced by 7%.

The most important direction of cost reduction for material-intensive industries is saving on the cost item "Material costs":

• introduction of new technologies;
• the use of non-waste technologies or the use of production waste;
• purchase of cheaper raw materials;
• change of suppliers of raw materials;
• discount system with a permanent supplier of raw materials.

The most common ways to reduce costs under the item "Material costs":

• reducing the purchase cost of raw materials by concluding contracts with manufacturers directly, bypassing intermediaries or shortening their chain;
• purchases of materials in bulk. In this case, you can get a discount from the supplier and save on transport costs. But for this, the enterprise must have free funds - for the purchase of large lots and for the storage of these stocks. Therefore, it is imperative to compare the costs of placing large consignments of materials with the benefits of their acquisition;
• independent production of some materials. But even here there are pitfalls: independent production is not always cost-effective and often more expensive to produce on your own than to buy a finished product from a supplier;
• Buying cheaper raw materials is the most common way to cut material costs. At the same time, it is worth paying attention to the quality of the purchased raw materials: with such a reduction in costs, the quality of the finished product may suffer, and this may lead to a loss in demand and, as a result, a decline in profitability.

Option 4

The company buys cheaper raw materials.

Raw materials and materials for 5001.80 rubles are spent on 1 chair. (Table 6).

According to the analysis carried out by the procurement department, it is possible to change some suppliers with a more favorable pricing policy, as can be seen from table 6 (columns 7-8 of table 6). Then the cost per unit of production will be reduced by 356.00 rubles, savings for the entire volume - 1,651,840.00 rubles. (4640.00 × 356).

Conclusion

The company will make a profit:

11,360,000.00 - 16,850,180.04 - 4,640.00 (10,655.94 + 4,645.80) = 23,509,746.36 rubles.

In addition to the considered methods to reduce costs, reducing overhead costs is considered no less effective: they are not directly related to the production of products and their reduction cannot affect the production process and / or the quality of the products.

We have considered the most common methods for increasing profitability, now we will conduct a comparative analysis of the effectiveness of their application (Table 7).

Table 7

Comparative analysis of the effectiveness of using various methods to increase profitability

As you can see, the most profitable way was to reduce labor costs as having the largest share in the cost of production. Its implementation allows you to increase profits by 30%.

To achieve the same result in terms of profit, it would be necessary to increase sales from 4640 units. up to 5400 units or increase the retail price from 24 to 26 thousand rubles. Meanwhile, the increase in sales implies additional costs for the expansion of production, the recruitment of additional workers and the question remains whether such a number of chairs will be in demand on the market. In addition, an increase in prices can lead to the loss of some buyers.

Thus, the most rational is the method of cost reduction based on the results of the analysis of absolute profitability indicators.

Now let's see how the proposed methods will affect the indicators of profitability of sales of products and profitability of sales (Table 8).

As a result of the implementation of any of the methods, the indicators improve, reaching a maximum as a result of a reduction in costs under the cost item “Payment”. This means that the production of the enterprise will become more efficient, and the enterprise itself will become more competitive.

The most effective cost reduction method for an enterprise is under the item “Payment”, which was implemented by automating part of the production processes.

The problem should be solved comprehensively and the cost price should be reduced for several cost items at once, not only to increase profits, but also to reduce the retail price.

findings

It is important to keep abreast of the profitability of the enterprise, to look for ways to increase it.

Recall that the following factors affect the level of profitability:

• selling price of a unit of production. It should be at the level of competitors and correspond to the payment capabilities of buyers. To increase profitability, they use the method of increasing the selling price, which, accordingly, increases sales revenue and profit;
• sales volume, directly related to the level of demand in the sales market. The planned volume of production must correspond to the demand for products: it makes no sense to produce much more than what the market requires (except in the situation of building stocks of finished products). To increase profitability, they increase production volumes and look for new sales channels for products, thus increasing revenue;
• cost of production. If the cost price exceeds the proceeds from the sale of products, then the company will become unprofitable. To increase profitability, they try to reduce the cost while maintaining the same sales revenue.

The most effective method is to reduce the cost of production, since there is no guarantee that the product will be purchased at an inflated price or will be bought in larger quantities.

When implementing the cost reduction method, several important aspects should be taken into account, the main of which is that the quality of products cannot be reduced by reducing the costs of its production.

In addition, it is worth remembering that when choosing this method of increasing the level of profitability, it is recommended to reduce costs in several areas (for example, for the cost items "Payment" and "Material costs", the costs of which, according to statistics, have the largest share in the cost of production). This will make it possible to achieve the maximum effect from the implementation of the method under consideration: to increase the level of profitability, to reduce the selling price of a unit of production, which means to ensure greater competitiveness and attract more potential buyers.

INTRODUCTION 3

1. THEORETICAL ASPECTS OF PROFITABILITY OF A TRADING ENTERPRISE 5

1.1 The economic essence of the income of a trading enterprise 5

1.2 Formation and use of income from the sale of products (works, services) 9

1.3 Profitability as an indicator of the profitability of an enterprise 15

1.4 Ways to increase the profitability of the enterprise 16

2. ANALYSIS OF INDICATORS OF ECONOMIC ACTIVITIES OF A TRADING ENTERPRISE 20

2.1 Organizational and legal characteristics of the activities of the Nessk Consumer Society and the main activities 20

2.2 Income analysis of the Ness Consumer Society 24

CONCLUSION 34

REFERENCES 36

ANNEX 1 38

INTRODUCTION

In the process of supply, production, marketing and financial activities, a continuous process of capital circulation takes place, its structure and sources of formation, the availability and need for financial resources and, as a result, the financial condition of the enterprise, the external manifestation of which is solvency, change.

An analysis of the profitability of an enterprise makes it possible to draw up a general conclusion regarding the effectiveness of its activities: the profitability of capital investment and the optimality of the costs incurred. The system of indicators of profitability is also disclosed, which makes it possible to comprehensively assess the effectiveness of asset management and the profitability of activities.

The versatility of the problems associated with increasing the profitability of a commercial enterprise predetermine the relevance of the study.

The purpose of the study is to study the concept of profitability of a commercial enterprise, to study the financial condition and profitability of the Ness consumer society in order to identify reserves for their improvement.

The purpose of the study is achieved as a result of solving a certain interconnected set of analytical tasks:

formulating the concept of profitability of a commercial enterprise;

analysis of the financial condition of the enterprise;

identification of reserves to improve financial stability and profitability.

The object of the study is the Ness consumer society.

The subject of the study is the financial processes that determine the profitability of a given trade enterprise.

The first chapter presents the theoretical aspects of the concept under study.

In the second chapter, the characteristics of the enterprise under study are given, an analysis of profitability indicators is carried out and measures are proposed to increase it.

The research method is a systematic approach in which any system (object) is considered as a set of interrelated elements.

The methodological basis of the study was the works of Russian and foreign economists, publications in the periodical press on the problem under consideration.

The practical basis of the study was the reporting data on the enterprise of the Ness consumer society.

1. THEORETICAL ASPECTS OF THE PROFITABILITY OF A TRADING ENTERPRISE

1.1 The economic essence of the income of a trading enterprise

In a market economy, represented by the movement of commodity-cash flows, income always acts as a certain amount of money. Income - is a monetary assessment of the results of the company's activities in the form of a sum of money coming into its direct disposal. It reflects the economic performance of the company's economic activities. This means that the condition for obtaining monetary income is effective participation in the economic life of society. The very fact of receiving it is an objective evidence of such participation, and its size is an indicator of the scale of this participation.

The profitability of an economic entity is characterized by absolute and relative indicators. The absolute rate of return is the amount of profit or income. The relative indicator is the level of profitability.

Gross output, which reflects the measure of their contribution to the satisfaction of social needs, is considered to be a generalizing indicator of the activity of enterprises and industries. Unlike industry, where the term “gross output” is usually used, trade sectors do not produce goods and the value created in them is called gross income (hereinafter referred to as IR). This value is created by the labor of trade workers.

Gross income at the macro level reflects the share of trade in the sum of prices for consumer goods.

The gross income of a commercial enterprise as an economic category in the traditional sense is a part of the cost of goods, which is intended to cover distribution costs and generate profits. It contains pure products. Net production characterizes the newly created value, which, as in other sectors of the economy, consists of the wages of workers and profits (Fig. 1).

Rice. 1. Composition of retail products

The amount of income of a trading enterprise is one of the results of its economic activity. The income of a commercial enterprise is the financial basis of its activities.

The most complete economic essence of the income of the enterprise is manifested through the following major tasks, the implementation of which they provide:

Reimbursement of all current costs (distribution costs) associated with the implementation of its economic activities. The implementation of this task ensures the self-sufficiency of the current economic activity of a trading enterprise.

Ensuring the payment of various types of tax payments that ensure the formation of funds from the state and local budgets, extra-budgetary funds. The implementation of this task ensures the fulfillment of the financial obligations of the trading enterprise to the state.

Formation of profit of a trading enterprise, due to which funds for production development, additional material incentives for personnel, social payments, payments to property owners, reserve, etc. are formed. The implementation of this task provides self-financing of the development of the trade enterprise in the coming period.

Independence, self-sufficiency, self-financing require that the size of the gross income of a commercial enterprise exceed the costs necessary to fulfill its tasks, i.e. the gross income of a commercial enterprise is the initial prerequisite for the competitive functioning of the enterprise.

According to GOST R 51303–99 “Trade. Terms and definitions” gross trade income is an indicator that characterizes the financial result of trading activity and is defined as the excess of revenue from the sale of goods and services over the costs of their acquisition for a certain period of time 1 .

Under the income of an enterprise, from the point of view of accounting (according to paragraph 2 of PBU 9/99), it means an increase in economic benefits as a result of the receipt of assets (cash, other property) and (or) repayment of obligations, leading to an increase in the capital of the organization, with the exception of contributions of participants (property owners) 2 .

For a deeper understanding of this definition, it is necessary to understand what is meant by the terms "economic benefits", "assets" and "capital".

The only definition of economic benefits can be found in the Concept of Accounting in the Market Economy of Russia (hereinafter referred to as the Concept), approved by the Methodological Council on Accounting under the Ministry of Finance of Russia and the Presidential Council of the Institute of Professional Accountants on December 29, 1997. In the Concept, you can find the concept of "future economic benefits", which is understood as the potential ability of property to directly or indirectly contribute to the inflow of cash and cash equivalents into the organization (clause 7.2.1) 3 . At the same time, it is considered that the object of property will bring economic benefits in the future if it can be:

- used separately or in combination with another object in the production of products, works, services intended for sale;

- exchanged for another object of property;

- used to pay off accounts payable;

- distributed among the owners of the organization.

As a rule, cash equivalents are understood as highly liquid securities, which, if necessary, can be very quickly converted into cash (sold on the securities market) without a significant loss in their value. For example, government and municipal securities are classified as cash equivalents.

Unlike economic benefits, the definition of assets is not contained anywhere at all, even in the named Concept. In this regard, it is extremely difficult to define them by referring to normative acts. Based on the content of paragraph 2 of Art. 8 of the Federal Law of November 21, 1996 No. 129-FZ “On Accounting”, then assets can be identified with property owned by the organization on the basis of ownership.

The concept of "capital" is the most difficult not only in accounting, but also in economic theory. In this regard, there is no generally accepted definition of capital not only in our legislation, but also in world economic theory. Most often, capital is defined as the property of an organization, free from obligations to third parties.

According to Art. 41 of the Tax Code of the Russian Federation "Principles for determining income", income is understood as an economic benefit in cash or in kind, taken into account if it is possible to assess it and to the extent that such benefit can be assessed, and determined in accordance with Chapter 25 of the Tax Code of the Russian Federation 4 .

Thus, the Tax Code of the Russian Federation, as well as PBU 9/99, understands economic benefits as income. However, unlike PBU 9/99, the Tax Code of the Russian Federation does not link economic benefits with an increase in the organization's capital.

1.2 Formation and use of income from the sale of products (works, services)

Various aspects of the production, economic and financial activities of the enterprise are reflected in the system of indicators of financial results. This system is formed by indicators of profit and profitability, as well as gross income - proceeds from the sale of products (works, services).

In a market economy, the basis for the economic development of an enterprise is formed by profit. Profit indicators are becoming the most important for assessing the production and financial activities of enterprises as independent producers. Profit is the main indicator of the efficiency of the enterprise, the source of its life. Profit growth creates a basis for self-financing of the enterprise, the implementation of expanded reproduction and the satisfaction of the social and material needs of the workforce. At the expense of profit, the obligations of the enterprise to the budget, banks and other organizations are fulfilled. Several indicators of profit are calculated 5 .

The final financial result of the enterprise is the balance sheet profit (loss). Balance sheet profit is the sum of profit from the sale of products (works, services), profit (or loss) from other sales, income and expenses from non-sales operations. The calculation of the balance sheet profit can be presented as follows:

PB=PR+PP+PVN, (1)

where PB - balance sheet profit (loss);

PR - profit (or loss) from the sale of products (works, services);

PP - the same from other implementation;

PVN - income and expenses on non-sales operations.

Profit from the sale of products (works, services) is, as a rule, the largest part of the entire balance sheet profit of the enterprise. It is defined as the difference between the proceeds from the sale of products at the wholesale prices of the enterprise (excluding VAT) and its full cost. If the cost of production exceeds its cost in wholesale prices, then the result of the production activity of the enterprise will be a loss. The calculation of profit from the sale of products can be represented as a formula:

PR = VD–W pr –VAT, (2)

where VD - gross income (revenue) from the sale of products (works, services) in current wholesale prices;

Z pr - the cost of production and sales of products (full cost of production);

VAT - value added tax.

In gross income, the completion of the production cycle of the enterprise, the return of funds advanced for production into cash and the beginning of their new turnover are expressed. Gross income also characterizes the financial performance of the enterprise. At manufacturing enterprises, revenue consists of the amounts received as payment for products, works, services to the enterprise's accounts in banking institutions or directly to the enterprise's cash desk. Trade and public catering enterprises determine gross income from the sale of goods as the difference between the sale and purchase value of goods sold. For non-self-supporting organizations, gross income is income from economic and other commercial activities.

Production costs (Z pr) of sold products (works, services) include the full actual cost of sales of products (works, services), i.e. the cost of raw materials, labor costs for production workers, as well as overhead costs associated with the management and maintenance of production: for the maintenance of management personnel, rent, electricity, maintenance and current repairs. Subtracting all these expenses from the proceeds from sales, we get profit from the sale of products (works, services), i.e. profit from production activities.

Profit (loss) from other sales is the balance of profit (loss) from the sale of products (works, services) of ancillary, auxiliary and service industries, not included in the volume of sales of the main marketable products. It also reflects the financial results of the sale of surplus and unused material assets. They are defined as the difference between the sale (market) price of the property and the initial or residual value of the property, adjusted for the inflation index.

Incomes (expenses) from non-sales operations combine various receipts, expenses and losses not related to the sale of products. This indicator includes:

1) the amount of economic sanctions and compensation for losses. This is the total amount of fines, penalties, forfeits and other economic sanctions received and paid, with the exception of those paid to the budget in accordance with the law. The latter are at the expense of the profit remaining at the disposal of the enterprise.

2) incomes (losses) of previous years revealed in the reporting year;

3) losses from natural disasters;

4) losses from writing off debts and receivables;

5) receipts of debts previously written off as uncollectible;

6) income from the lease of property;

7) income received from equity participation in joint ventures;

8) dividends on shares, bonds and other securities owned by the enterprise;

9) other expenses, income and losses attributed in accordance with the current legislation to the profit and loss account.

Net profit (NP) is the profit remaining at the disposal of the enterprise. It is defined as the difference between the taxable book profit (BOP") and the value of taxes, taking into account benefits (N"):

PE \u003d PB "–N", (3)

To determine the taxable profit, the balance sheet profit is increased (reduced) by the amount of the excess (reduction) of the cost of wages for the personnel of the enterprise engaged in the main activity in the structure of the cost of goods sold in comparison with their normalized value. The following are excluded from the amount of profit received:

- rent payments made to the budget from profit in the prescribed manner;

– income (dividends, interest) received from shares, bonds and other securities owned by the enterprise;

– income from equity participation in other enterprises; profit from insurance activities; other income from non-sales operations; the amount of deductions to the reserve fund and other similar funds, the creation of which is provided for by law; income tax benefits.

The general scheme for the formation and use of profit and net income is shown in Figure 2 6 .

At present, the directions of using net profit are determined by the enterprise independently. State influence on their choice is carried out through taxes, tax collections and economic sanctions. In the future, a transition from income tax to corporate income tax is envisaged.

Rice. 2 Formation and use of profit in market conditions

Profit indicators characterize the absolute efficiency of the economic activity of the enterprise. Along with this absolute

the assessment also calculates the relative indicators of economic efficiency - profitability indicators (R).

1.3 Profitability as an indicator of the profitability of an enterprise

Depending on what indicators are used in the calculations, there are several indicators of profitability. Their numerator is usually one of three values: profit from sales (PR), balance sheet profit (BOP) or net profit (NP). The denominator is one of the following indicators: costs for the production of sold products, production assets, gross income, equity, etc.

Specifically, thus, the following indicators are calculated (table 1).

Table 1

Profitability indicators

1.4 Ways to increase the profitability of the enterprise

In a market economy, a variety of factors affect the profitability of an enterprise. They can be classified according to various criteria.

Depending on the direction of activity, they can be grouped into two groups: positive and negative.

Depending on the place of occurrence, all factors can be classified into internal and external.

All internal factors can be divided into objective and subjective. Objective - these are factors, the occurrence of which does not depend on the subject of management. Subjective factors make up the vast majority, they are completely dependent on the subject of management. The profitability of the enterprise largely depends on external factors.

Also, the profitability of the enterprise is influenced by extensive and intensive factors.

Extensive factors include factors that reflect the volume of production resources, their use over time, as well as unproductive use.

Factors that reflect the efficiency of the use of resources 7 are considered intensive.

These factors affect profit not directly, but through the volume of products sold and the cost.

In the current difficult situation, one of the most important tasks of the enterprise is to find possible ways to avoid bankruptcy and increase profitability. Income growth, which is the main indicator of the break-even operation of an enterprise, depends primarily on reducing production costs, as well as on increasing the volume of products sold, while such products and goods must be produced that meet consumer requirements and are in great demand.

Measures related to the improvement of the use of working time have a significant impact on cost reduction. For many industries that are material or energy intensive, the most important way to reduce costs is to save materials and energy.

At present, cost reduction should become the main condition for the growth of profitability and profitability of production.

No less important factors affecting the profitability of the enterprise is the change in the volume of production. The larger the sales volume, ultimately, the more profit the company will receive, and vice versa 8 .

Improving the quality of manufactured products can be achieved through many factors, such as technical improvement of production, modernization work, etc. Obviously, the quality of products determines the level of prices in the enterprise, which largely affects the amount of profit.

It should also be taken into account that the change in the balance of unsold products affects the amount of profit, and hence the profitability of the enterprise. In order to increase profits, the enterprise must take appropriate measures to reduce the balance of unsold products, both in quantitative and total terms.

Recently, in the context of the development of entrepreneurship, there are more opportunities to increase profits through non-operating operations. In this area, financial investments can be the most profitable. Specific directions and structure of financial investments should be the result of a well-thought-out enterprise policy based on a reliable assessment of their effectiveness.

A business can also rent out some of its assets and end up with income that increases its gross profit 9 .

From this list of measures it follows that they are closely related to other measures aimed at reducing production costs, improving product quality, and more efficient use of all factors of production.

The company is very necessary to determine the so-called break-even point of production and sales. The break-even point corresponds to the volume of sales at which the firm covers all fixed and variable costs without making a profit. With the help of the break-even point, the threshold beyond which the volume of sales provides profitability is determined. Moreover, when determining the strategy, the firm must take into account the margin of financial safety. Having a large margin of financial strength, an enterprise can develop new markets, invest funds both in securities and in the development of production 10 .

When determining the break-even point and the margin of financial strength, entrepreneurs can plan the amount of profit growth depending on economic success in the production of competitive products and take appropriate measures in advance to change the value of variable and fixed costs in one direction or another.

2. ANALYSIS OF INDICATORS OF ECONOMIC ACTIVITIES OF A TRADING ENTERPRISE

2.1 Organizational and legal characteristics of the activities of the Nessk Consumer Society and the main activities

The Ness Consumer Society was founded on June 10, 1918. A consumer society is a voluntary association of citizens and legal entities created on a territorial basis on the basis of membership by combining its members - shareholders of property shares for trade, procurement, production and other activities in order to meet the material needs of its members. The Company is a legal entity, has an independent balance sheet, current and other bank accounts, a seal and other details. Acts on the basis of its Charter, owns property, can acquire and exercise property rights and perform duties on its own behalf, be a plaintiff and defendant in courts.

Citizens and legal entities who have made entrance and share contributions and accepted into the society are shareholders.

Legal address of the consumer society: 166737, Arkhangelsk region, Nenets Autonomous Okrug, Nes village, st. School 11. The society was created for an indefinite period.

The purpose of the company is to satisfy the material and other needs of shareholders.

The governing bodies of the company are currently: the general meeting of the company - the highest body; Society Council - legislative body; The board of the company is the executive body. The auditing commission is the control body.

The general meeting of the company is authorized to resolve all issues related to the activities of the company. The Board of the Society is accountable to the General Meeting and resolves all issues of the Society's activities in the period between meetings. The Board of the Company is the executive body and is accountable to the Council of the Company.

The basis of economic activity is its property, which belongs to it by the right of ownership as a legal entity.

The sources of formation of the property of the society are:

– entrance and share fees;

– income from entrepreneurial activities of the company;

- the property that comes into the ownership of the company during the creation of the company;

- income received from the placement of its own funds in banks, securities;

- funds received from other sources not prohibited by the legislation of the Russian Federation.

The objects of property rights of the company are property complexes, buildings, structures, equipment, raw materials and materials, money, securities.

The main principles of conducting economic activities of the company are:

– break-even for society as a whole;

- democratic management;

– financial and economic discipline;

– responsibility of the chairman of the company’s Council, members of the company’s Council, the chairman of the company’s board and members of the company’s board for the results of the company’s economic activities;

– obligatory informing of shareholders by the Board of the company and the board of the company about the results of the economic activity of the company.

The main activities of the Nessky Consumer Society:

– production and sale of bread and bakery products;

– retail trade of food and industrial goods;

– public catering;

- provision of household services.

The average number of employees in the Ness consumer society in 2009 was 46 people.

Currently, the company unites about 700 shareholders and serves about 1.6 thousand people.

The diagram of the organizational structure of the Ness consumer society clearly illustrates fig. 3:

Rice. 3. Organizational structure of the Ness consumer society

The structure of the Ness consumer society includes 3 shops, 2 bakeries, a cafe, a hairdresser, a sewing workshop.

Bakeries are engaged in baking bread, bakery and confectionery products. Bread and bakery products are sold in the stores of the consumer society to the population of the village. Nes and the village of Chizha, as well as children's and educational institutions and health care institutions.

All work with suppliers is carried out by the trading department of the Ness Consumer Society. The Trade Department reports to the Chairman of the Board for Trade. The department in its work is guided by the laws of the Russian Federation, the charter of the Ness consumer society. In the trade department there is a mandatory assortment list of goods, which is approved by the Ness consumer society, the administration of the village council, and the sanitary and epidemiological station.

When working with suppliers, the Ness Consumer Society uses various forms and terms of delivery.

The Ness Consumer Society concludes contracts for the supply of goods with manufacturing and intermediary firms located in Arkhangelsk, St. Petersburg, Yaroslavl, as well as trade agreements with individuals. It works with many regular suppliers of the Ness Consumer Society on a consignment basis, i.e., it receives goods for sale with subsequent settlement. The main suppliers are presented in Table 2.

table 2

Information about the suppliers of the Ness Consumer Society for 2009

The main buyers of products are children's institutions and healthcare institutions for cashless payments, the population for cash payments.

The Company's main competitors in rural areas are private entrepreneurs with certain advantages. One advantage of a competitor is pricing flexibility. Other advantages of competitors include: tax benefits, the ability to quickly adapt to changing market requirements; acceptable working hours for buyers (although the society is working to improve the mode of operation of trade and catering enterprises and the opening of 24-hour enterprises). All this contributes to an increase in the turnover of retail trade and public catering, meeting the demand of shareholders and villagers, increasing jobs, as well as ensuring the safety of goods by accelerating turnover). The disadvantages of competitors' work include: non-compliance with sanitary requirements, insufficiently high level of service quality, weak material and technical base.

2.2 Income analysis of the Ness Consumer Society

Let's analyze the composition and dynamics of profit "Nessskoye consumer society based on the income statement f. No. 2 for 2009, the results are presented in Table 3.

The following profit indicators are used in the analysis: balance sheet profit, profit from the sale of products, works and services, profit from other sales, financial results from non-sales operations, taxable profit, net profit.

The balance sheet profit includes financial results from the sale of products, works and services, from other sales, income and expenses from non-sales operations.

Taxable profit is the difference between the balance sheet profit and the amount of real estate tax, profit taxable on income (on securities and from equity participation in joint ventures), profit received in excess of the marginal level of profitability, withdrawn in full to the budget, costs taken into account when calculation of income tax benefits (measures to eliminate the consequences of the Chernobyl disaster, environmental and fire prevention measures, maintenance of children's health camps, nursing homes, etc.).

Net profit is the profit that remains at the disposal of the enterprise after paying all taxes, economic sanctions and contributions to charitable funds.

Table 3

Analysis of the composition and dynamics of the profit of the Ness consumer society

Thus, according to the results of the obtained table 2, we can conclude that, compared with the previous year, there is an increase in sales proceeds by 4813 thousand rubles, however, an increase in cost by 1550 thousand rubles. and an increase in selling expenses by 3967 thousand rubles. had a negative impact on the profit from sales indicator, as a result of which a loss on sales in the amount of 723 thousand rubles is determined in the reporting year. On a positive note, the organization's other income increased by 572 thousand rubles, as a result of which the net profit of the Nessky Consumer Society in the reporting year amounted to 650 thousand rubles, however, compared to the previous year, the net profit indicator decreased by 20 thousand rubles. Summarizing the above, the company needs to look for ways to increase profitability.

In table 4, we will carry out a factor analysis of sales profit, determine the influence of each factor.

Table 4

Factor analysis of sales profit

Thus, according to the results of the table obtained, it can be said that the greatest negative impact on the receipt by the consumer society of profit from the sale of products by 2367.94 thousand rubles. showed the level of selling expenses, which means that the company needs to look for ways to reduce selling expenses in order to increase the profitability of the organization.

Table 5 shows the gross profit structure of the Ness Consumer Society in 2009.

Table 5

Gross profit structure

According to Table 4, we can say that the largest share in the structure of gross profit is occupied by the cost price - 57.16%, the largest share in the proceeds from sales is 89.27% ​​of retail trade.

In the production and sale of household and other services, expenses exceed income, gross profit has negative values, so the company needs to consider the feasibility of this type of activity or look for ways to reduce costs.

The revenue structure is clearly shown in Figure 4.

Rice. 4. Revenue structure of the Ness consumer society in 2009

In table 5, we consider the profitability indicators of the Ness consumer society.

Return on sales is determined by formula 4.

(4)

Shows how much profit falls on the unit of sold products. An increase in the profitability ratio indicates an increase in profitability.

Accounting profitability from core activities is calculated using formula 5.

Accounting profitability shows the level of balance sheet profit. An increase in the profitability ratio indicates an increase in profitability.

Net profitability from core activities is determined by formula 6.

Net profitability from core activities shows how much net profit falls on a unit of revenue. An increase in the profitability ratio indicates an increase in profitability.

Net profitability for all types of activities is calculated using formula 7.

Shows how much net profit falls on the unit of income of the organization. An increase in the profitability ratio indicates an increase in profitability.

Economic profitability is calculated using formula 8.

Economic profitability shows the efficiency of using all the property of the organization, the growth of the profitability ratio indicates an increase in profitability.

Return on equity is determined by formula 9.

The return on equity shows the effectiveness of the use of equity, it should ensure the return on investment in the enterprise.

Table 6

Profitability indicators of the Ness consumer society

Thus, according to the results of the presented table 6, we can conclude that the enterprise has relatively low profitability values, and also tends to decrease, the profitability of the Ness consumer society is decreasing.

Summarizing the above, we will offer ways to increase the profitability of the enterprise.

In order to improve their activities by involving the enterprise in the turnover, the management needs to carry out the following activities:

1) The reserve for the growth of the enterprise's income is the growth of the level of gross profit. Thus, it is necessary to increase the size of the trade margin, having previously studied the pricing policy of competitors. The level of trade markup should not exceed that of competitors.

2) It is necessary to increase labor productivity, for this it is necessary to make the wage rate dependent on the performance of each individual employee, and, if necessary, optimize the staffing table;

3) Since the cost of goods sold increased significantly in the reporting year, it is necessary to conclude an agreement with a supplier on more favorable terms or change a supplier who will supply goods that are not inferior in quality to competitors' goods, but at lower prices;

4) Since the factor analysis of profit from sales had a negative impact on the level of commercial expenses, the enterprise needs to revise this item of expenses and strive to minimize them;

5) It is necessary to pay attention to the sale of goods with the highest level of gross profit, in particular, to expand their range in accordance with customer requests; to conduct a competent advertising policy or to ensure the holding of sales for insufficiently popular goods;

6) A significant part of the income goes to cover distribution costs, so one of the ways to increase the final profit is the relative savings in the cost of selling goods, so you should pay special attention to the formation of sales costs, striving to minimize them;

7) To improve the organization of labor on the basis of a comprehensive rationalization of the trade and technological process.

8) It is necessary to plan profit, constantly analyze the activities of your enterprise, find out the reasons for the change in revenue, gross income, gross profit and normal profit in the previous period.

One of the methods of modern advanced management is an almost daily analysis of the financial condition of the enterprise. Such an analysis makes it possible to successfully use marginal analysis for planning profits and profitability, the elements of which are demonstrated above. If the generally accepted analysis allows you to successfully conduct business and make high-quality calculations, then the use of limiting values ​​\u200b\u200ballows you to make calculations of future profits with a fairly high degree of accuracy and, based on the analysis of related industries, determine in time funding priorities for the long term.

CONCLUSION

Self-financing of trade enterprises requires, first of all, the receipt of income from economic activities and, at a minimum, the excess of these incomes over current costs.

The profitability of an economic entity is characterized by absolute and relative indicators. The absolute rate of return is the amount of profit or income. The relative indicator is the level of profitability. The income of an enterprise can be classified taking into account accounting, tax and traditional economic approaches, in which there are certain differences.

The specific proportions of the distribution and use of income, which are divided into income from ordinary activities and other receipts, are of great importance for the economic regulation of the economic activity of the enterprise and are determined by it independently, because. the financial possibilities of the enterprise and the direction of its further development depend on the absolute size and ratio of various funds and deductions.

The profitability of enterprises in trade is now most strongly influenced by two factors. In a positive way, the factor of the commodity hunger that has not yet passed, which is supported by the stratification of the population according to income, and the growing middle class, whose representatives retain sufficient purchasing power, has a positive effect. Economic and political instability negatively affects profitability. Both of these factors have a negative impact on long-term profit and profitability planning.

The analysis of the financial activity of the Ness consumer society revealed a decrease in the profitability of the enterprise in 2009, based on the identified problems, ways to increase profitability were proposed.

LIST OF USED LITERATURE

Tax Code of the Russian Federation. Parts one and two. - M.: LLC "TK Velby", 2009. 512 p.

GOST 51303–99 Trade. Terms and Definitions. IPK Publishing House of Standards, 1999

Bakanov, M.I., Theory of economic analysis / A.D. Sheremet - M.: Finance and statistics, 2007. - 387 p.

Balabanov, I.T. Analysis and planning of the finances of an economic entity. - M.: Finance and statistics, 1998. Bernstein L.A. Analysis of financial statements: Translated from English / Scientific editorial translation of Corr. RAS I.N. Eliseev. Ch. ed. a series of prof. I'M IN. Sokolov. M.: Fiance and statistics, 2006. - 306 p.

Volkov, O. I. Economics of the enterprise / V. K. Sklyarenko: Course of lectures. - M.: INFRA - M., 2003. -280s.

Gruzinov, V. G. Economics of the enterprise / V. D. Gribov: Proc. allowance. - 2nd ed. add. - M.: Finance and statistics, 2001. - 208s.

Novodvorsky, V.D., Sabanin R.L. Accounting and tax accounting of income and expenses. - St. Petersburg: Piter, 2003. 256 p.

Kovaleva, A. M. Firm's finances. / M. G. Lapusta, L. G. Skamay. - M.: INFRA - M., 2008. - 416s

Petrov, P.V. Economics of commodity circulation. / A.N. Solomatin. M.: INFRA-M, 2007. - 220 p.

Production management: Textbook for universities / S.D. Ilyenkova, A.V. Bandurin, G.Ya. Gorbovtsov and others; Ed. S.D. Ilyenkova. – M.: UNITI-DANA, 2000. – 583 p.

Financial management: Textbook for universities / N.F., Samsonov, N.P. Barannikova, A.A. Volodin and others; Ed. N.F. Samsonov. - M.: Finance, UNITI, 1999. - 495 p.

Economics of the enterprise (firm): Textbook / Ed. prof. O. I. Volkova and Assoc. O. V. Devyatkina. - 3rd ed., revised. and additional - M.: INFRA - M., 2004. - 601s.

Enterprise Economics: Textbook for High Schools / Ed. prof. V. L. Gorfinkel, prof. V. A. Shvander. - 3rd ed., revised. and additional - M.: UNITI - DANA, 2003. - 718s.

APPENDIX 1

Level indicator profitability enterprises, it characterizes the efficiency of work enterprises generally, profitability various directions ... in the last decade, requires enterprises raise production efficiency, product competitiveness and...

The profitability of an enterprise is an indicator that directly affects profit, that is, the final result of the activity of any enterprise. Increasing the profitability of an enterprise is one of the main goals of the management of any enterprise. There are many ways to increase profitability, each company chooses the most suitable for a particular company. Let's consider the main methods of increasing profitability and see what impact they have on the final result of financial and economic activity.

In order for the company to be profitable and take a stable position in the market, it is necessary:

• produce products that are in demand. You can produce a lot of products, but if there is no demand for it, then there is no point in such production;
• sell products at the price that corresponds to the average market price and at which potential consumers are ready to purchase this product. To set such a price, the company's specialists must study the sales market, potential consumers, their needs and paying capacity, the competitiveness of the enterprise and the prices of competitors for the same type of product;
• produce products in the quantity required by the market so that the product does not stay in stock, especially if it has a limited shelf life;
• to produce products with a rational calculation of production costs. When production costs exceed the proceeds from the sale of products, production is considered unprofitable and unprofitable, it does not make a profit. This can lead to bankruptcy.

We estimate the level of profitability

Profitability assessment involves the analysis of absolute and relative indicators characterizing its level.

The absolute indicator is profit. Due to it, the enterprise can increase the wage fund, expand and increase production turnover, finance other activities, and so on. In general, profit is the difference between the cost of selling a product and its cost (the sum of all costs spent on manufacturing this product).

The amount of profit can be found from the financial statements, namely from the income statement (form No. 2).

Consider a fragment from the financial statements for 2016 of Alfa LLC, which manufactures chairs (Table 1).

Table 1 Statement of financial results for 2016

So, the revenue of Alpha LLC for 2016 from the sale of 4640 chairs at a price of 24,000 rubles / unit. - 111,360 thousand rubles. Production and sales costs amounted to 89,494 thousand rubles.

We subtract the full cost from the proceeds and get a profit from the sale - 21,866 thousand rubles. Net profit (net of taxes and other expenses, the main indicator of the effective functioning of the enterprise) is 17,493 thousand rubles.

When analyzing absolute indicators, net profit is not the only thing worth paying attention to. No less important is the ratio of sales revenue to the cost of production.

If the values ​​of the cost of production and the proceeds from its sale are approximately equal, the enterprise will receive little profit, so one should strive to obtain more revenue at lower costs. Thus, we can conclude that an enterprise can be considered profitable if its proceeds from the sale of products are sufficient to cover all the costs of production and sale of products and to form a difference, i.e. profit.

After the absolute indicators of profitability, we analyze the relative indicators - profitability, i.e. indicators of the economic efficiency of the enterprise.

Product sales profitability (ROM, Returnon Margin) is the ratio of profit (loss) from sales to cost.

In our case ROM= 21,866,258.36 / 89,493,741.64 x 100% = 24.43%.

Important!

The higher the rate of profitability of product sales, the more efficient the production and sale of products, and hence the higher the competitiveness of the enterprise. To increase this indicator, it is necessary to reduce the cost of production and sales of products, to increase sales volumes.

Profitability of sales (ROS, Margin on sales) is the ratio of profit (loss) from sales to revenue.

In this example ROS= 21,866,258.36 / 111,360,000.00 x 100% = 20%.

As you can see, the values ​​of the indicators of profitability and competitiveness of the analyzed enterprise are quite large (the maximum minimum profitability is 5%).

The composition of the cost includes all the costs incurred by the enterprise for the production of this product and its sale. They are grouped into two major categories: conditionally permanent and conditional variables.

The first ones (Table 2) do not depend or weakly depend on the volume of production (for example, depreciation deductions, rent for premises, wages of personnel not related to the production of products, purchase of office supplies, information and consulting expenses, expenses for telephony, Internet, etc. ), the latter (Table 3) directly depend on the volume, i.e., they either increase with an increase in the volume of production, or decrease with its decrease (for example, the cost of raw materials and materials, wages of the main production workers, etc.).

table 2 Fixed costs for 2016

The amount of semi-fixed expenses for 2016 is 16,850,180.04 rubles. Regardless of changes in the volume of production, it will remain at the same level.

Table 3 semi-variable costs

Taking into account the norms for the consumption of materials and the cost of wages for the main production workers per chair, the amount of conditionally variable costs for the entire volume of production (4640 units) is calculated - 72,643,561.60 rubles.

The sum of conditionally fixed (16,850,180.04 rubles) and conditionally variable expenses (72,643,561.60 rubles) gives a cost estimate of the total cost (89,493,741.64 rubles; see also Table 1).

We calculate the allowable volume of production at which the enterprise will cease to be profitable, but will not become unprofitable - breakeven point.

Break-even sales volume is 2019 chairs. With such a quantity, the enterprise will not receive any profit or loss, and only starting from 2020 units. the company will begin to make a profit. In this case, the amount of conditionally fixed (16,850,180 rubles) and conditionally variable expenses (15,655.94 x 2019 = 31,609,342 rubles) is approximately equal to the amount of sales proceeds (2019 x 24,000 = 48,456,000 rubles). ), it is in this scenario that there will be neither profit nor loss.

The difference between the planned sales and the breakeven is called strength threshold. In our example, this is 2621 units. It is necessary to monitor this indicator and prevent it from approaching zero.

At this point, we cover all costs - both conditionally fixed and conditionally variable, and each next sold unit of production will bring approximately 8344 rubles. profit (24,000.00 - 15,655.94).

For greater clarity, we will draw up a break-even chart based on the initial data (Table 4).

In this graph, the values ​​of costs (total, variables) and revenue are located vertically, and the values ​​of sales volume are located horizontally. The graph shows that at the value of 2019 units. the lines of revenue and total costs intersect, which means that at this point their values ​​are equal.

For all values ​​of sales volume below 2019 units. the cost line exceeds the revenue line, therefore, the enterprise is unprofitable; at values ​​above 2019 units. the revenue line exceeds the cost line - the company makes a profit.

Methods for increasing the level of profitability

The main factors that a company can influence are increase in sales, increase in the cost of selling a unit of goods and cost reduction.

Option 1

We will increase sales from 4640 units. up to 5,000 chairs per year, subject to the demand for such a quantity in the sales market and maintaining the current number of employees without expanding production.

Revenue \u003d 5000 x 24,000 \u003d 120,000,000 rubles.

Semi-fixed expenses = 16,850,180.04 rubles.

Conditionally variable costs \u003d 5,000.00 x 15,655.94 \u003d 78,279,700 rubles.

Profit from sales = 120,000,000 - 16,850,180.04 - 78,279,700 = 24,870,119.96 rubles.

Conclusion

Having increased the volume of sales by 360 chairs and retained the selling price per unit, we received additional profit in the amount of 3,003,861.60 rubles.

Option 2

We will increase the cost per unit of production to 25,000 rubles. Other things being equal, the situation will be similar to the previous one. Revenue will increase and amount to 116,000,000 rubles. (25,000.00 x 4640) while maintaining the same level of conditionally fixed and conditionally variable costs.

Conclusion

In this case, the profit will be 26,506,258.36 rubles. (116,000,000 - 89,493,741.64), which exceeds the value of profit at a unit cost of 24,000 rubles. for 4,640,000 rubles.

Both in the case of an increase in sales volume and in the case of an increase in price, it is necessary to take into account the nuances. There are no guarantees that, for example, an enterprise will be able to sell an increased volume of production - it is quite possible that the market does not need such a quantity. And then the enterprise, which has already spent funds on the production of more products, which, moreover, could not sell, will have to bear the costs of organizing / renting a larger warehouse for finished products. And if the products are perishable, the company will also incur losses with such an increase in production. To avoid such situations, you need to carefully analyze the market and potential buyers.

As for the rise in the price per unit of production: when, other things being equal, the properties of the goods (quality, design, etc.) increase in its cost, buyers may refuse to purchase the goods. This situation can also be aggravated by comparison with the prices of competitors.

We found that the profitability of any enterprise is affected by a change in the balance of unsold products, as is the case with an increase in production volume with a constant sales volume. The remainder (360 units that will not be sold) is an incomplete receipt of revenue, therefore, the non-receipt of profit with the funds already spent on the production of these 360 ​​chairs.

To increase the level of profitability and profitability, the company needs to reduce the balance of unsold products.

And finally, we turn to the most common way to increase profitability - reducing production costs. To reduce the cost of production, enterprises often develop methods and programs for the implementation of certain measures. But first, it is necessary to study the cost structure item by item and determine the specific weight of each item (Table 5).

Table 5 Composition and cost structure

In the price structure, the largest share is occupied by two cost items - "Material costs" and "Expenses for wages of the main production workers and insurance premiums". It is rational to start reducing production costs with them.

Ways to reduce costs under the item “Expenses for wages of the main production workers and insurance premiums”:

• reduce the number of employees (for example, by automating some processes);
• cut wages. But this may entail the departure of highly qualified specialists. Therefore, various motivation systems and progressive wage systems are usually used so that production workers perform a larger amount of work for the same wage level.

Option 3

We will reduce the number of key production workers by 10 people, subject to the automation of some production processes.

The total number of employees before the reduction - 80 people.

On average, each person per year under the item “Expenses for wages of the main production workers and insurance premiums” accounts for 617,940.12 rubles. (with an average salary of about 50,000 rubles). In the event of a reduction in the number of employees, the costs under this item will be 43,255,808.40 rubles.

But at the same time, new equipment will be purchased for automation, which will increase the cost item "Depreciation" by 10% and amount to 57,015.68 rubles.

Conclusion

The cost price will be 83,319,523.68 rubles, profit - 28,040,476.32 rubles.

The payroll cost item was reduced by 7%.

The most important direction of cost reduction for material-intensive industries is savings under the cost item "Material costs":

• introduction of new technologies;
• the use of non-waste technologies or the use of production waste;
• purchase of cheaper raw materials;
• change of suppliers of raw materials;
• discount system with a permanent supplier of raw materials.

The most common ways to reduce costs under the item "Material costs":

• reducing the purchase cost of raw materials by concluding contracts with manufacturers directly, bypassing intermediaries or shortening their chain;
• purchases of materials in bulk. In this case, you can get a discount from the supplier and save on transport costs. But for this, the enterprise must have free cash - for the purchase of large lots and for the storage of these stocks. Therefore, it is imperative to compare the costs of placing large consignments of materials with the benefits of their acquisition;
• independent production of some materials. But even here there are pitfalls: independent production is not always cost-effective and often more expensive to produce on your own than to buy a finished product from a supplier;
• Buying cheaper raw materials is the most common way to cut material costs. At the same time, it is worth paying attention to the quality of the purchased raw materials: with such a reduction in costs, the quality of the finished product may suffer, and this may lead to a loss in demand and, as a result, a decline in profitability.

Option 4

The company buys cheaper raw materials.

Raw materials and materials for 5001.80 rubles are spent on 1 chair. (Table 6).

According to the analysis carried out by the procurement department, it is possible to change some suppliers with a more favorable pricing policy, as can be seen from table 6 (columns 7-8 of table 6). Then the cost per unit of production will be reduced by 356.00 rubles, savings for the entire volume - 1,651,840.00 rubles. (4640.00 x 356).

Conclusion

The company will make a profit:

11,360,000.00 - 16,850,180.04 - 4,640.00 (10,655.94 + 4,645.80) = 23,509,746.36 rubles.

In addition to the considered methods to reduce costs, reducing overhead costs is considered no less effective: they are not directly related to the production of products and their reduction cannot affect the production process and / or the quality of the products.

We have considered the most common methods for increasing profitability, now we will conduct a comparative analysis of the effectiveness of their application (Table 7).

Table 7 Comparative analysis of the effectiveness of using various methods to increase profitability

As you can see, the most profitable way was to reduce labor costs as having the largest share in the cost of production. Its implementation allows you to increase profits by 30%.

To achieve the same result in terms of profit, it would be necessary to increase sales from 4640 units. up to 5400 units or increase the retail price from 24 to 26 thousand rubles. Meanwhile, the increase in sales implies additional costs for the expansion of production, the recruitment of additional workers and the question remains whether such a number of chairs will be in demand on the market. In addition, an increase in prices can lead to the loss of some buyers.

Thus, the most rational is the method of cost reduction based on the results of the analysis of absolute profitability indicators.

Now let's see how the proposed methods will affect the indicators of profitability of sales of products and profitability of sales (Table 8).

As a result of the implementation of any of the methods, the indicators improve, reaching a maximum as a result of a reduction in costs under the cost item “Payment”. This means that the production of the enterprise will become more efficient, and the enterprise itself will become more competitive.

The most effective method for reducing costs for the enterprise is under the item "Payment", which was implemented by automating part of the production processes.

findings

It is important to keep abreast of the profitability of the enterprise, to look for ways to increase it.

Recall that the following factors affect the level of profitability:

• selling price of a unit of production. It should be at the level of competitors and correspond to the payment capabilities of buyers. To increase profitability, they use the method of increasing the selling price, which, accordingly, increases sales revenue and profit;
• sales volume, directly related to the level of demand in the sales market. The planned volume of production must correspond to the demand for products: it makes no sense to produce much more than what the market requires (except in the situation of building stocks of finished products). To increase profitability, they increase production volumes and look for new sales channels for products, thus increasing revenue;
• cost of production. If the cost price exceeds the proceeds from the sale of products, then the company will become unprofitable. To increase profitability, they try to reduce the cost while maintaining the same sales revenue.

The most effective method is to reduce the cost of production, since there is no guarantee that the goods will be purchased at an inflated price or will be bought in larger quantities.

When implementing the cost reduction method, several important aspects should be taken into account, the main of which is that the quality of products cannot be reduced by reducing the costs of its production.

In addition, it is worth remembering that when choosing this method of increasing the level of profitability, it is recommended to reduce costs in several areas (for example, for the cost items "Payment" and "Material costs", the costs of which, according to statistics, have the largest share in the cost of production). This will make it possible to achieve the maximum effect from the implementation of the method under consideration: to increase the level of profitability, to reduce the selling price of a unit of production, which means to ensure greater competitiveness and attract more potential buyers.