ASSESSMENT OF THE MANAGEMENT OF PRODUCT PROFITABILITY FORMATION

Abstract

The article is devoted to topical issues of assessing the management of the process of profitability of the enterprise. One of the main goals of the company is to make a profit and further refinancing in its development. The process of managing the formation of product profitability - as the main source of income - is extremely important for businesses, as its results determine the success of the entity, characterize the main indicators and opportunities for further investment in scientific and technological progress and social development. The management of the process of forming the profitability of products is based on maximizing positive financial indicators from the initial investment in production and sales. A positive result can be achieved through tools such as compiling and implementing a set of tasks to ensure the growth of production and sales, an effective process of managing production costs, improving the efficiency of fixed assets and productivity, as well as improving the management system. There are many factors that affect profitability and are subject to risk assessment. These factors are divided into external and internal. External factors influencing profitability are factors that do not depend on the activities of the enterprise. Such factors have a significant effect on the business, but are not influenced by the entity. However, the management of the enterprise must take into account the existence of such factors, determine the degree of impact and the probability of the risk of threat to reduce profits or cessation of economic activity. The main indicators for the analysis of product profitability are analyzed and systematized. The indicators considered in the article are conditionally divided into 4 main groups, namely: indicators of efficiency of use of fixed and non-productive assets, labor resources, material resources and working capital. The calculation formulas and characteristics of each indicator are presented. The calculation and analysis of the values of these indicators allow the top management of the entity to make appropriate decisions to improve financial and economic results and the most efficient use of resources.