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RETURN ON INVESTMENT FOR EXECUTIVES – BASIC CONSIDERATIONS

May 16, 2020by derek.lackey0

In all Marketing Activities there are three major objective standards towards which effort must be directed:

Return on Investment Net Profit as a Percent of Sales Sales and Market Participation

In order to establish goals and manage your resources towards their achievement, you must recognize and become involved with a wide range of key business elements, among which are:

1. Sales and Gross Profits

2. Investment in Merchandise

3. Investment in Receivables

4. Expenses and Net Profits

5. The Measure and Evaluation of Risk

6. The Degree of Market Penetration

7. The Image of your Business in the Eyes of the Customer and Investors

8. The Accurate Assessment of the Trends and Trend Changes in the Market

Not all of the topics may apply specifically to your business, but should provide a broad overview when considering your future marketing activities. Attached is a set of ratio’s that can be of assistance to you in the future.

Return on Investment

One important measurement tool used to evaluate sales performance and in making market decisions is Return on Investment. Yes, the purpose of business entities is still to make a positive return for the effort invested. This applies whether the venture is for profit or not for profit.

The crucial test of business efficiency lies in the Return on Investment ratio formula:

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