Abstract
“I don't understand it at all: I put 25 percent profit on every job and never get more than 5 percent by the end of the year. What am I doing wrong?” asked the printer.
This is a preview of subscription content, log in via an institution to check access.
Access this chapter
Tax calculation will be finalised at checkout
Purchases are for personal use only
Notes
- 1.
“Art” may be more apt.
- 2.
Contribution refers to what is commonly referred to as gross profit contribution, being the amount left over after deducting the cost of goods or materials used; it “contributes” to covering overhead expenses plus any net profit. In other words, contribution = (overheads + net profit). Alternatively, contribution = (sales – cost of goods or materials); or net profit = (contribution – overheads).
- 3.
Unit refers to the key activity fundamental to output—in this case a production-hour.
- 4.
To emphasize its benchmark status and avoid confusion with a “cost,” the target average contribution rate is known as the Target Average Rate Index or TARI.
- 5.
52 weeks less 7 weeks (4 weeks annual holiday + 10 days public holidays + 5 days sick leave).
Author information
Authors and Affiliations
Rights and permissions
Copyright information
© 2013 Keith N. Cleland
About this chapter
Cite this chapter
Cleland, K.N. (2013). Printing Business Multiplies Net Profit by 500%. In: IMPROVING PROFIT. Apress, Berkeley, CA. https://doi.org/10.1007/978-1-4302-6308-1_3
Download citation
DOI: https://doi.org/10.1007/978-1-4302-6308-1_3
Published:
Publisher Name: Apress, Berkeley, CA
Print ISBN: 978-1-4302-6307-4
Online ISBN: 978-1-4302-6308-1
eBook Packages: Business and EconomicsBusiness and Management (R0)Apress Access Books