Profitability level, post #1

Today I wanted to discuss briefly the so important profitability level of a company.

In any discussion with a business owner this is of course a super important topic. So I will break this post up into several posts to make it easier to read.

When discussing profit with company owners, I often get the answer when asking that the turn over is X, and I think that the profit is Y, roughly.

Continuing to probe, I get, is that before or after tax, are you taking that as dividend or leaving it in the company I often get a reply that I do take dividends but I am not sure what the amount is, my accountant will tell me that.

I often then also get the reply that while the Y level is the profit I am often re-investing all of that into the business, or I am re-investing most of that into the business.

I am interested in your view on that as a reader. I know that it is very commonly stated that we should of course reinvest into the busienss because it helps us grow.

The question is; does it?

What is your view?

I will break down some thoughts in my next post.

To be continued in the next post....