(Luận văn) profits and profit enhancement solutions at tocontap sundries import export company

Stemming from the great role of profitability of production and business activities, during the internship at Hanoi grocery import-export company luan van tot nghiep download luanvanfull

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INTRODUCTION

When it comes to business and production activities, people often mention its effectiveness Productivity - quality - efficiency is the goal of striving for advanced production, a measure of qualifications in all aspects of the national economy as well as for each production unit

A production unit is a cell of the economy in general, the strong development of each cell will create the growth of the economy In our country, State-owned enterprises are the direct creation of material wealth and accumulation of capital for society, it plays a key role in the process of building and developing the country in line with the socialist orientation means In the current period, our country's economy is in a great transition from the central planning mechanism

to the macro-regulated market mechanism of the State, fully subsidized by the State to produce business So far, these units have to account for profit and loss business, requiring businesses to make great efforts to survive

On the other hand, in the context of fierce competition in the market economy between enterprises of different economic sectors, enterprises have constantly accumulated capital to develop and invest to expand their business This can only

be done when the business operation of the highly efficient business earns a lot

of profits Profits are now considered as one of the most effective economic leverages to strongly stimulate businesses' production and business activities Profit not only reflects the efficiency of production and business in the market economy condition but it is also an important financial source to carry out reproduction and expand production and business activities and improve the lives of people labor in the business

Stemming from the great role of profitability of production and business activities, during the internship at Hanoi grocery import-export company

luan van tot nghiep download luanvanfull moi nhat z z @gmail.com Luan van thac si

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(TOCONTAP) with the enthusiastic help of teacher Nguyen The Vinh and other staffs working in the Accounting and Finance department of my company have

completed the graduation thesis with the topic "Profits and profit

enhancement solutions at TOCONTAP Sundries Import Export Company" Within the time allowed to study and research, my dissertation was completed but could not avoid the shortcomings and limitations that required further research Therefore, I look forward to receiving the instruction from the teachers, along with all the readers to help me complete the thesis better

In the course of completing this essay, I was guided by the enthusiastic teacher Nguyen The Vinh and the support and facilitation of officials in Hanoi grocery import-export company (TOCONTAP)

With deep gratitude: I would like to express my sincere thanks to Ms Nguyen The Vinh and the officials of Hanoi Sundries Import Export Company (TOCONTAP) in the past time for helping me with all my heart to complete this thesis

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TABLE OF CONTENTS

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LIST OF FIGURES AND TABLES

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LIST OF ACRONYMS

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Chapter I: General arguments about profitability

I Profits of an enterprise in a market economy

 Mixed ownership business

State-owned enterprises: are economic organizations with capital established by

the State and organized production and business activities to serve the state's socio-economic objectives

A private enterprise: is an enterprise established, managed, and solely

responsible by all of its assets with the debts of the enterprise

Mixed-owned enterprise: is an enterprise in which the owner is a collective of

individuals or organizations These members conduct production and business activities, share profits and take responsibility for the company's debts as part of their capital contribution

This classification specifies the relationship of ownership of capital and assets of different economic sectors, which is the basis for dividing economic efficiency

by contributed capital and also the basis for the state to prescribe the main regime Economic policies, development orientations for each type of enterprises

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1.2 Characteristics of businesses in a market economy

In a market economy, there are many different types of businesses, so there are also different characteristics However, enterprises generally have the following characteristics:

 All businesses are constantly seeking ways to improve production and business efficiency

 Enterprises are autonomous units in business and financial autonomy

 Business activities of enterprises are governed by the laws of the market economy such as the law of competition, the law of supply and demand, the law of value

 All economic benefits of the business are distributed fairly

2 Profit of the enterprise

2.1 Notion:

- Profits are a quality indicator to evaluate the economic efficiency of businesses in production and business activities That is the final financial result after a process of conducting business and production of the business

- In the term of trade (The langugue of trade): Profit is the net income generated by the production or sale of goods and services Means the remaining amount for the entrepreneur after paying all capital (interest), land (rent), labor (including administrative costs, wages, wages), raw materials crude, taxes and depreciation If the business is poor, profits can

be negative and in that case they turn into losses

- From an enterprise's perspective, profit is essentially the difference between revenue and the total cost of production and business that

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businesses spend to get that revenue in a given period Accordingly, profit

is determined as follows:

Profit = Revenue - Cost - Tax

- The origin and nature of profit:

The study aimed at elucidating the origin and nature of profits was conducted by economists from the early years of the 18th century Although, nearly 200 years later, the origin and nature of profits was only K Marx clarified, he was also the one who exposed the exploitative nature of capitalism towards hired workers

Previously the schools of economics and the thinkers of economics had continually studied the origin and nature of profits but could not come up with a clear explanation that profit was being produced from where

The first person to study that profit was Adamsmith, who, according to him,

"Profit is a deduction from the value of products made by workers", the source of profit is due to the entire investment capital spawned in both field of production and circulation

Unlike Adamsmith, David Ricardo said, "Profits are the excess value out of the value of goods created by workers always greater than the amount of wages that workers are entitled to and the difference is profit" Thus, David Ricardo's ideas have improved more than Adamsmith's arguments, he pointed out that the source

of profits is the "excess value" in addition to the costs paid to workers and the profits from created by workers, not by all investment capital

In the 19th century, the source of profit was properly understood through the analysis of K Marx Based on scientific theories and scientific methods, K Marx pointed out that participating in the process of creating goods value has 3 components: immutable capital, variable capital and surplus value residual

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 Immutable capital is a part of value that exists in the form of means of production (factories, machines, raw materials, fuels, auxiliary materials, etc.) whose values are preserved and transformed integrity into the product, no change in quantity during production (symbolized c)

 Variable capital is the part of capital that exists in the form of labor generated and unpaid by workers, in other words, the capital division used

to purchase labor that is not reproduced the value but through the abstract labor of the employee increases, ie the change in quantity (symbolized v)

 Surplus value is the value of the excess of the value of labor goods created

by the employee and taken over by the capitalist (symbolized as m)

From this we find that participating in the creation of surplus value has two elements: invariant capital and volatile capital If the symbol of the value of goods produced in a capitalist enterprise is Gt, then Gt = c + v + m (1) - the actual labor cost of society to produce goods But for the capitalists to hide their exploitation, they thought that the surplus value was not created by the labor of the workers but it was caused by the capital loss created, that is, c and v, c + v create From that point of view, capitalists argue that capitalist production costs generate profits, not the (v) division that generates surplus value

If the symbol of capitalist production cost is K (K = c + v) then we have the value of goods: Gt = K + m (2), from which we have K = Gt-m, that gives see capitalist production cost is always smaller than the actual cost of society to produce goods When c + v translates into capitalist production costs, for the capitalist, the surplus value manifests itself in the increase in the appearance of capitalist production costs that the capitalist obtains

The surplus value when compared to the total capital advance is in the form of profit If the symbol of profit is p then from (1) and (2) we have Gt = K + p or

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the value of capitalist goods production cost + profit The essence of profit is the value of the surplus created in production, or the value of the surplus is the content inside, is the basis of profit, and profit is the external expression of m

In fact, in terms of quantity, the basis of p is m but more or less the amount of p depends on the market price

 When price equals value, p = m

 When the price is greater than the value, then p > m

 When the price is less than the value then p < m

Thus, we can see that p can be greater than or equal to or less than m and regulated by the supply-demand relationship in the market If the supply is greater than the demand, then the price of goods is smaller than the value of goods, so the profit earned by the business is smaller than the surplus value Conversely, when the supply is smaller than the demand, the price of the goods

is greater than the value of the goods and therefore the profits are greater than the surpluses

Besides, K Marx also pointed out the conflicting relationship between profit and salary Lowering wages while constant commodity prices cause profits to rise and vice versa wages to rise while commodity prices do not rise will reduce profits, indicating an opposition to economic benefits between capitalist and hired workers

Above is the analysis of the origin and nature of profits in the form of capitalist production, and under the socialist production base, the profits still retain the origin and nature? The answer will be: Profits are still generated by the department (v) i.e workers created but different in that: under the capitalist regime, the means of production are capitalist, so the profits are made in the

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pocket capitalism in its own way, and under the socialist regime it is based on the public ownership of means of production so after paying wages for employees will use the profits to supplement the business capital of the enterprise, the rest will be distributed to the fund with the purpose of continuing

to maintain production and business activities of the business and at the end The same is to serve the interests of workers

Conclusion: Through the above analysis, we can affirm that the nature of profits

in production and business is surplus value, a form of variation of surplus value - the result of unpaid labor, is exploitative relations in the Techmart society The source of profit is created by employees, it is the excess value of wages made by employees Under the capitalist regime, profit is appropriated by the capitalist and shows a contradictory relationship on the economic interests between the capitalist and the hired labor that creates class conflict in the capitalist society under the socialist regime, the main benefit is to serve the interests of workers, thanks to which workers will be satisfied with economic benefits and contribute

to the economic development of the country , building a society of equal and civilized progress for the prosperous life of workers

2.2 Profit structure

Each business with each industry, each investment field produces a different type

of profit But overall corporate profits include:

 Profits from business activities

 Profits from financial activities

 Abnormal operating profits

2.2.1 Profits from business activities

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Profits from production and business activities are profits earned from the sale of goods, services and labor from production and business activities of enterprises

For enterprises engaged in production and business activities, profits earned from production and business activities constitute the largest proportion of the total profits achieved by enterprises It is a prerequisite condition for businesses to accumulate to serve the expansion of reproduction, and it is also a prerequisite condition for businesses to set up job loss support funds, reward funds, Therefore, profits from production and business activities are crucial to the existence and development of enterprises

Profits from production and business activities include profits from major production and business activities and profits from specific auxiliary production and business activities:

- Profits from main business activities:

Profits earned from the main business activities are formed from performing the main functions and tasks of the enterprise, which are stated in the decision to establish the enterprise and stated in the business registration certificate business This profit constitutes a large proportion of the total profit of the enterprise, and this is also an indicator reflecting the proper implementation of functions and tasks set out by the business

Profits from the main business activities are determined as the difference between the revenue from the main business activities and the expenses from the main business activities

- Profits from side business activities:

Profits earned from activities conducted outside the main functions and duties of the enterprise, supporting the main business operations of the enterprise and

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making the most of its resources, raising the efficiency of the enterprise use capital, labor and technical materials, machinery and equipment

Profits earned from the subsidiary business is the difference between the revenue from the subsidiary business and the expenses allocated to that subsidiary business

Profits from the secondary business, although not accounting for a large proportion of the total profit, it affects the increase and decrease of the total profit that the enterprise earns and also shows the thorough utilization of opportunities business, diversify opportunities for profit, minimize risks from unpredictable changes from the business environment of the business

- Methods of determining profits from production and business activities of enterprises:

We have the formula to determine the profit of production and business activities

as follows:

Profit = Revenue - Cost

 Revenue from production and business activities:

All revenues from the sale of goods, services and services during the period Which includes:

+ Turnover from the main production and business activities: is the proceeds from the main production and business activities of the enterprises recorded in the business licenses of the enterprises

+ Turnover from auxiliary production and business activities: is an extra charge outside the main production and business activities of the enterprise in order to exploit and make the most of available resources in the enterprise

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 Sales deductions include:

+ Discount on goods sold: is the amount accepted by the enterprise to the buyer

in case the goods are of poor quality or of poor quality according to the contract, the buyer requests a discount Or because buyers buy in bulk and get discounts from businesses Therefore, reducing the price of goods can accelerate the sale of goods and recover capital quickly However, it is also possible that the sale price

is reduced due to poor quality If the sale price is greatly reduced, the net revenue

of the enterprise will decrease and this will lead to a decrease in the total profit

 Export tax

 Special excise tax (if applicable)

 VAT paid by enterprises that pay VAT by the direct method and input VAT that has not been deducted for businesses that pay VAT by the deduction method

+ Cost of goods sold:

Is an important factor directly affecting the profits that businesses earn The cost

of goods sold depends on the different types of businesses, which are determined differently

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 For commercial enterprises, the cost of goods sold is the cost of buying goods for consumption in the period, including:

 Purchase price of goods consumed in the period

 Expenses incurred during the purchase process such as transportation, loading and unloading, packaging costs allocated

to goods consumed in the period

 For production and business enterprises, the cost of goods sold is the production cost of products, labor, services and consumption in the period, including:

 The cost of materials directly

 Direct labor costs

 Workshop management costs

 Selling expenses:

This is an expense incurred in the process of selling products, goods, services Including salaries and allowances paid to salespeople, costs of packaging materials, preservation and transport goods Depreciation expense of fixed assets, tools, tools, utensils for sales There are also other costs such as advertising costs, marketing, market surveys, warranties, commissions

 Enterprise Cost Management:

All costs of living and materialized labor arising in the course of enterprise management, administrative management and other general expenses of the whole enterprise are expressed in cash

Enterprise management expenses include: Expenses for enterprise management staff, expenses for materials used in management, expenses for office equipment and depreciation of fixed assets There are also costs: taxes and fees, contingency costs, outside service costs, and other cash costs

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2.2.2 Profit from financial activities

It is the profit gained from the financial investment activities of the enterprise, the capital investment outside the enterprise such as: capital contribution to joint ventures, business associates, capital contributions, activities of buying and selling bills, bonds , stocks, asset leasing, real estate trading, interest on deposits and loans from business capital and funds, foreign currency trading Currently, the development trend of the stock market where the main financial investment activities of enterprises is mainly securities investment due to the flexibility in capital conversion of the stock market and the ability to earn profits high from this investment

Financial income is the difference between income and expenses of financial activities

Profits from financial activities are determined as follows:

 Revenue from financial activities: is the income from financial investment activities: joint venture, associate, securities trading, interest from bank deposits, exchange rate differences, Reversal of financial reserve fund

 Expenses of financial activities: including expenses for participation in joint ventures, associates, selling securities, loan brokerage expenses, expenses due to foreign currency exchange differences, interest payment expenses, expenses Financial provision

2.2.3 Abnormal operating profits

It is the profit earned by an enterprise from irregular business activities, which is not anticipated or expected but is not feasible These profits are earned by subjective or objective reasons

The abnormal operating profit is determined as follows:

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 Revenue from unusual activities: is the income from irregular, unforeseen

or unlikely business activities of the enterprise, including items such as: Liquidation of assets, transfer of fixed assets sold out of use, bad debts recovered, now collected, compensation paid by the partner for breach of contract, omitted incomes

 Unusual expenses: are expenses incurred by the enterprise which are not anticipated by the enterprises, including: Expenses for liquidation, sale of fixed assets which have expired, the amount of money fined for compensation contracts and retrospective collection of taxes, assets lack of unidentified causes, omitted expenses

From the methods of determining the profit of the enterprise, we have the formula to determine the total profit of the enterprise as follows:

Total profit = Total revenue - Total cost Thus, it can be seen that due to different industries and business sectors, there is

a difference in the proportion of profit of each profit division in the total profit of the enterprise On the other hand, depending on each enterprise, each stage and period of business, the profit structure of the enterprise may include 3 or 4 parts

of profit that the enterprise has achieved in the period

Studying profit structure is important for each enterprise so that the enterprise can take appropriate measures to adjust and improve profits from its financial activities to suit its function and tasks of enterprises, at the same time overcome weaknesses and limitations that exist in production and business activities of enterprises, promote positive aspects to obtain the highest profits

2.3 Profit margin

Notion: Profit margin are relative indicators that allow business and production efficiency to be compared between different periods in an enterprise or between enterprises in the same period

Based on the profit margin, people evaluate the effectiveness of the business production The higher the profit rate, the greater the business efficiency and vice versa

The determination of profit rate also has many different ways, each carrying a different economic content depending on the business, the business that uses the profit margin accordingly We can consider some common profit margins:

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2.3.1 Return on sales:

2.3.2 Return on capital:

2.3.3 Return on cost:

2.4 The role of profit

In terms of business accounting in the market mechanism, whether the business exists and grows depends on whether the business operates effectively or not, can it generate profits? This shows that profitability is very important for the existence and development of businesses

In a market economy, there are many individuals, organizations and enterprises doing business and production activities, in which production and business activities of enterprises play a key role in creating the overall development of the economy The country, the existence and development of businesses is also creating income for the state and for workers So profit also plays a role with the state, with workers Specifically, the role of profit is shown in the following points:

 The role of profitability for the business:

 Profit plays an important role in the production and business activities of the enterprise, both being a target, both a motivation and a condition of existence and development of the business

The operation of an enterprise in a market economy, although each stage has different goals and tasks But finally, the specific goals and tasks that the business set out in each period only serve its ultimate purpose of generating profit

The free market economy operates within the framework of the provisions

of law, self-accounting for revenues and expenditures, and interests bearing profits Therefore, profit is both a goal and a motivation and a condition of existence of the business Without profit, businesses will not have capital to organize business activities for profit-making purposes as well as to maximize profits It is also for profit that businesses constantly expand and enhance their production and business activities to meet the market demand to win in competition Only a profitable business can the enterprise have a physical premise to preserve and develop business capital, expand the business scale, or in other words to survive and develop

 Profits are a basic economic indicator to evaluate the production and business efficiency of enterprises

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Profits are general economic indicators reflecting the entire business process of an enterprise, affecting all aspects of the production and business process, which is the difference between the revenue earned by the enterprise and the expenses to get those revenues

The larger the difference between these two economic indicators, the more effective and profitable the business is This reflects that the business operation has met the requirement of self-accounting and subtracting income from expenses

In contrast, the smaller the profit target and the negative tendency indicates that the enterprise is in a state of ineffective operation, the revenue is not enough to cover expenses, the goods are not sold out and remain stagnant in the warehouse This shows that the current business does not meet the needs of consumers for goods and services Therefore, when considering profit as a general economic indicator reflecting the efficiency of the production and business process of the enterprise, it is required that the business planning business plan must set out the measures to best meet the needs of customers, increase sales and take measures to lower production and business costs

 Profits are an important source of accumulation to help businesses invest

in depth to expand the scale of production and business, which is a condition to strengthen the strength and reputation of businesses in the marketplace

Indeed, after the enterprise has fulfilled its obligations to contribute to the State Budget and distributed to entities participating in the joint venture, the rest will be distributed to such funds as the first fund investment and business development, financial reserve fund, these funds are used to invest in expanding production and business activities, changing equipment and machinery, researching new and suitable technology equipment rationalize production with market demand, so that businesses can be more financially autonomous, easily invest in depth to improve labor productivity, paving the way for improving profits of the business

 Profits affect all business activities of the enterprise, affecting the business capital and financial situation for the production and business activities of the enterprise

When the business operation of an enterprise is effective, it means that the enterprise is a profitable enterprise, which shows that not only can the

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business preserve its capital but also have an additional profit to the source business capital of the enterprise In the context of fiercely competitive market economy, capital which is very important allows businesses to carry out large-scale projects, invest in research, innovation and perfect production and business technology, improving reputation is the competitiveness of enterprises in the market Thus profit is an important condition to ensure a stable financial situation of the business

 For investors and employees:

For investors involved in business activities on the market, the profit for them

is a dream, a desire and a desire to achieve For employees working in enterprises, the profits are associated with and directly affect their interests, with them profits increase their incomes and improve their lives, increase their economic benefits When workers are adequately paid, they will be assured of working, promoting the spirit of creative, responsible and whole-hearted work for the work and thus increasing the overall labor productivity

of Employees in the company make the company's operations better and better

 For the State:

 Profits contribute to increasing the state budget revenue and improving social welfare

For the state, businesses and business entities in the economy will make significant contributions to the State's revenue through the fulfillment of the obligation to pay taxes to the State Budget, such as: : corporate income tax, excise tax

Through the fulfillment of its obligations to the State Budget, the State can carry out activities of investment in national economic development and social justice Within the whole national economy, profit is the basic accumulation source to reproduce and expand the national economy, build infrastructure, build social welfare works, and establishing, renovating and expanding production and business establishments, creating job security police, increasing income for laborers, raising people's intellectual standards, building a society of modern and civilized justice

 Profits are the driving force for the development of the national economy

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The national economy consists of many business entities, of which the majority are enterprises and therefore the development of the enterprise system that creates profit development is the goal , being the driving force, the basis of existence and development, for the State, profit is also the driving force for developing the national economy

 Profits are one of the measures reflecting the effectiveness of the State's macro management policies on production and business activities of enterprises

Proper and open macroeconomic policies of the State will create favorable conditions for businesses to develop better, thus enabling businesses to improve their operating profits On the contrary, if micro policies are not suitable, negatively impacting on the operation of enterprises, it will hinder the development of enterprises and adversely affect the profits that enterprises gain

In short, profit is both a goal and a motivation, a condition of existence and development of businesses, thanks to profits, businesses expand production and business scale, invest in equipment innovation improve and improve product quality, create capital and solid financial capacity for production and business activities Profits contribute to bringing income to improve life and reproduce the labor power of workers, create employment police, solve unemployment Profits are also a source of revenue for the State budget, creating a basic source of accumulation to reproduce and expand the national economy With such importance, businesses are always looking for ways to improve profits and maximize profits

II Measures to improve profits in the business

1 The meaning of improving the profitability of the business

Stemming from the important role of profits, both as a goal and a motivation, as well as the conditions of existence and development of enterprises, it is necessary and objective for the improvement of profits every business in a market economy If the business does not make a profit, it means that the revenues of the business are not enough to offset the costs themselves, which means that the business is on track to make a loss and If this situation persists, businesses will inevitably go bankrupt This shows that only when businesses are profitable, they will allow businesses to exist and develop

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In fact, when the economy was governed by the centralized system of subsidies, the State was responsible for the entire production and business process of enterprises profit or loss does not affect the business This is one of the reasons leading to businesses in this period in particular and our economy in general operating inefficient, poor productivity, stagnant production, worker’s lives are not guaranteed

When our country's economy is transformed into a state-owned market mechanism that is managed only on a macro scale, businesses must be independent, proactive and self-responsible for their business results Moreover,

in the economy with the participation of many businesses, the competition is very fierce in the market The law of competition is very harsh only to accept businesses that make profits and eliminate businesses that make losses, putting businesses before the challenge of survival and development, they must meet the profit targets

Improving profits of production and business activities of enterprises also means improving financial capacity to meet the capital needs for business activities of enterprises, investing in expanding production and business, and exchanging new technology equipment, product innovation, improve product quality and better meet customer needs, enhance competitiveness, strengthen the strength and reputation of businesses in the market

Profits also mean creating income sources and raising incomes for workers, improving the lives of workers, creating job security and solving unemployment Improving profits also means raising revenues for the State budget, improving social welfare, and contributing to creating a driving force for the development

of the country's economy

Stemming from these important meanings shows that raising profits is not only decisive for businesses but also for the State, for employees, and the development of the economy citizen

2 Factors affecting the profitability of the business

There are many factors that affect the profitability of the business, including those that are outside the control of the business, and those that are under the control of the business, namely the following affect the profitability of the business

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2.1 The objective factors:

These are factors that are outside the subjective will of the enterprise, usually those are elements of the business environment where the enterprise is not able

to influence but can only adapt to changes from those environment aspects:

 Changes in the natural geographical environment, such as natural disasters, floods, fires, earthquakes, ., changes from the natural environment make businesses unforeseen, sometimes causing damage to production and business activities of enterprises, affecting profits earned

to develop, while on the contrary, it will inhibit the development of enterprises will have difficulties in meeting their profit targets

 A change in the nation's political institutions: is also a factor outside the control of the business In a country where there is political turmoil, the risk of doing business of that business in that country will be seriously threatened, moreover, changes in the nation's political institutions will impact to changing the legal system from that country sometimes leads to the risk of expropriation of that national government So that greatly affects the profits the business will achieve

 A country's changing economic environment The trend of the country's economy falling into recession, stagnant economy underdeveloped made businesses have to cut their operations and thus risk reducing the profits of enterprises.On the other hand, many economies have high inflation, the depreciation of the domestic currency makes the real value of enterprises' profits decrease and many businesses fall into real losses

 Changes in market and competitive environment of enterprises:

The market directly affects the operation and profitability of the business because the market is the place to provide inputs for businesses, and also where businesses will absorb their goods Therefore, when market fluctuations can lead to market expansion or contraction, the consumption

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of goods and services of the enterprise may be reduced, or may be reduced The increase will affect the revenue and profit that the business will gain

The entry or withdrawal of competitors in the market creates a two-way impact on the operation of the business When there are many competitors participating in the market in which the business is operating, the competition is increasingly fierce, leading to the risk that the market of the enterprise may be narrowed and therefore may reduce the profitability of the business

 Price fluctuations in the market: It is also an objective factor affecting the profitability of businesses Price affects the consumption of goods in the period that the business makes, so it will affect the revenue it earns and its profit because the profit is determined by Total revenue less business expenses allocated during the period

Nowadays, as the trend of globalization of the economy is growing, businesses' operations are directed to global scale, changes from the international business environment will affect profits These factors include: regional economic and financial volatility, with the typical 1997 Asian financial crisis as a specific example, relationship among governments, fluctuations in exchange rates are the factors that affect the profitability of businesses when they conduct business activities beyond the borders

2.2 The subjective factors:

In addition to the above objective factors, subjective factors that greatly affect the profitability of the business are:

 Human factor: It can be said that people play a central role and have a direct impact on the business results of the business

Human factor in the enterprise is the human resource of the business or that is the staff of the enterprise With professional qualifications, management skills, and job proficiency of the employees is the main determinant of profitability for the business Management skills, agility, flexibility in organizing and performing the work of leaders and the sense

of responsibility of all employees in the company will contribute to increasing work efficiency, from That facilitates to improve profits for businesses

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 Financial capability of enterprises: Financial capability is an important condition for businesses to develop, it allows businesses to have capital to carry out large-scale business projects, open investment expanding production, renewing technological equipment, improving product quality Moreover, with solid financial capacity, enterprises will be more active

in production and business activities as well as gain proactive position in market competition

 The organization and management of production and business activities in enterprises

Demonstrate in a reasonable arrangement of work for each employee to ensure that they have the ability to promote their own personal capacity and complete the assigned tasks Arranging the organizational structure of the business operation in accordance with the actual situation and requirements of the company, creating a close coordination among departments, linking into a unified system of operation from the top down The bottom line makes the production and business process of the business run smoothly and efficiently, increasing revenue and cutting unnecessary expenses, thereby increasing profits for the enterprise Conversely, if the organization and management of production and business activities of an enterprise are not good, it will adversely affect the business results of the enterprise and reduce the profitability of the business

 Structure of business items of the business: The structure of business items affects the consumption of goods of the enterprise thereby affecting the profitability of the business A reasonable commodity structure with the appropriate type and density of each good product will avoid stagnation due to stockpiles too large for market demand With a reasonable structure

of business items, in accordance with the needs of the market and allowing

to exploit the strengths of the business to facilitate the sale of goods and services of the business, it is inevitable to do increase profits of the business

 Quality of goods and services of the business: The quality of goods and services directly affects whether or not the customer accepts and purchases the Company's products and products on the market Therefore, the quality

of goods and services will affect the profit earned by the business Therefore, in order to improve profitability targets, enterprises need to improve designs, diversify products and goods, improve goods quality

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 In addition to the above subjective factors, there are many factors that affect the profitability of the business such as payment methods and service modes, sources of goods and quality of input sources The factors that businesses can control, so businesses need to have a plan to control these factors and consider the degree of influence of each factor on profits

so that measures can be taken positively and eliminate negative impacts to increase profits of the business

2.3 Factors affecting the export and import profits of enterprises:

Researching the factors that affect the level of foreign trade profits allows us to explore objective and subjective reasons to find ways to increase export and import business profits Factors that directly affect the profit of foreign trade:

 The flow of import and export goods:

If the prescribed profit flow for each goods sold is a fixed number, if the increase in sales of goods sold, the import-export unit will gain more absolute profits and vice versa In practice, many import and export units fail to realize their profit plan due to the failure to implement the plan for export and import goods Therefore, expanding and increasing the speed of goods circulation will increase the profitability of the business unit

 Structure of import and export goods:

Each type of import and export goods has its own profit level depending on many business factors: the level of competition in the market, business costs, import and export taxes are very different So, when the structure of business goods changes, the overall profit level of the company will be completely changed, but if the profit margin by the different ways of calculation also changes: If the commodity trading has high interest rates accounting for a high proportion in the whole structure of import and export goods, respectively, will increase the foreign trade profit and vice versa

 Price factor:

 Price of goods: the price of buying goods and selling prices of imported

and exported goods directly affect the profits of foreign trade units If the purchase price is too high, sold at market prices, then the gross profit (the difference between the selling price and the buying price) decreases and profits fall And conversely, if the buying price drops, the gross profit will

be large and the profit will be large If you want to reduce the price of the

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purchase, make the original purchase, make a comparison of the selling price of import suppliers to choose cheap supply of imports (of course, the quality of the purchase)

Market valuation also has a direct effect on foreign trade profits Normally, the prices are high in the absence of competition in the market,

if the profits are in the form of high monopoly profits, but the prices are high in the market with fierce competition, the purchasing power is high Low solvency of goods consumed slowly, profits will decrease

Therefore, in the context of market mechanism, the businessmen must have a firm grasp of the market in order to set up an appropriate commodity price policy whose ultimate goal is to boost sales, dominate the market and increase the absolute profit for business

 Cost of circulation costs: As mentioned above, foreign trade profits are

earned after gross profit less costs and taxes As a result, the circulation costs are high, even though the gross profit is large, the foreign trade profit will also decrease So the price of transportation costs increase or decrease also directly affect the cost of circulation and profit

 Exchange rate: In fact, in the payment of import and export goods,

Vietnamese enterprises participated in the use of strong foreign currencies but the purchasing power of these currencies is not stable but can change

or decrease compared to Vietnam dong Therefore, it will directly affect the profitability of import and export businesses If other factors do not increase or decrease when foreign currency prices rise against the Vietnamese currency, it will facilitate export business more effectively and the benefits of import activities will decrease and vice versa Therefore, for enterprises, although the increase and decrease of exchange rate is an objective factor, the close monitoring of the exchange rate situation changes in order to timely propose measures to adjust their business activities effects to increase profits for his import-export company

 Tax: Depending on the business results, taxes are the obligations that

import and export business units have to pay to the State The tax rate

directly affects the foreign trade profit of the enterprise

 Other factors: Such as minimizing the amount of fines and compensation

for not fulfilling economic commitments, reducing the amount of goods lost, loss in all business stages, choosing the appropriate form of payment also contribute to increased profitability

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3 Measures to improve the profitability of the business

From the formula:

Total profit = Total revenue - Total cost

We see that in order to improve the profitability of the business, we must take measures to increase sales and take measures to lower costs, the following are specific measures:

3.1 Measures to increase the revenue of the business:

There are many measures to increase the turnover of an enterprise, depending on the characteristics and business fields of each enterprise, which can be selected

to suit the actual situation of the business However, the requirement of the measures to increase revenue requires the enterprise to implement such a combination of measures to achieve an overall effect

 Develop business strategies and plans properly and in accordance with

the actual situation of the business

The right business strategy and plan allows the business to shape the direction the business will reach in the future, which will indicate the goals that the business needs to take to achieve the set goals enterprise When appropriate business strategies and plans allow businesses to make the most of resources for production and business, this will increase the performance of the business, contributing to increased profits

 Developing and implementing marketing plans and policies, promoting

market exploitation research to understand customers' needs

The implementation and implementation of marketing plans and policies: product policies, pricing policies, promotion policies, distribution policies together with promoting market exploitation research and understanding customers' needs allowing to meet well the needs of consumers,

contributing to increasing the performance of enterprises

+ With product policy: focusing on improving the quality of goods and

services, diversifying forms and models, organizing the good exploitation

of goods sources, organizing the stockpiling of goods to be ready to supply when the market needs

+ With the price policy: Need to determine a reasonable price to be able to

increase consumption volume while ensuring profit

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+ With promotion policy: Need to use measures such as advertising,

promotion to customers and consumers to increase sales

+ With the distribution policy: Need to select the location, build stores,

warehouses and factories and arrange distribution network so that goods can be delivered to customers as quickly as possible, at the same time The distribution network in the area allows the supply of goods and products in large quantities

 Well organizing business processes of products, goods and services of the

company

The well-organized process of trading of products and services requires the Company to perform well in all stages: input supply, to input, to stockpile, to consumption goods, payment organization perform well the above stages to allow businesses to meet customers' needs, increase sales, cut unreasonable expenses in the above process and thus increase the profitability of the business

 Selecting a reasonable structure of business items

The structure of the company's business items affects the consumption of goods and services by the business Therefore, in order to increase the profitability of the business, the enterprise needs to choose an appropriate business item structure both in quantity and proportion of goods in the structure, and how that structure is structured Must promote the strengths

of the business, attract customers to the business Selecting a suitable business item structure suitable to the segment of the consumer market that the business has analyzed and the implementation of a marketing promotion plan to attract customers will bring success to the business

 Organize and select appropriate sales methods, convenient payment

methods, and improve the quality of after-sales service

+ Method of sale: including wholesale or retail depending on the type of

business that business But choosing the right selling method will promote the consumption of goods and services of the business

+ Payment method: quick convenience for buyers will contribute to

encourage customers to buy goods from the business, reduce bad debts, thus increasing the profits of the business

+ After-sale services such as: installation and repair services, user manuals

convenience and quality contribute to attracting a large number of customers to businesses and increase the volume of products and goods consumption, increase sales and profits achieved by the business

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3.2 Measures to reduce costs of businesses:

In the course of operation, businesses must spend a lot of expenses to serve their production and business activities such as expenses for materials, wages for workers, and wear and tear of equipment hooks, transportation costs, storage costs, marketing costs, advertising costs These costs directly affect the profits

of the business Therefore, businesses need to pay attention to cost management because unreasonable and improper costs will reduce the efficiency achieved by businesses Reducing costs to improve profits does not mean cutting costs arbitrarily because doing so would be counterproductive because the revenue is always commensurate with the expenses that businesses spend Therefore, the essence of cost reduction measures is good management of expenses, avoiding wastefulness, loss of costs, and eliminating unreasonable expenses Specifically, the following are measures to lower the cost of the business

 Strengthening cost management: By planning and calculating the costs

that businesses will have to spend in the period Develop and launch a sense of cost savings for all employees in the enterprise Use material as well as mental incentives to encourage people in the company to save business costs, to encourage everyone's initiatives to reduce costs In addition to saving costs, it is also necessary to use some tough measures such as discipline for cases of cost loss or fraudulent expense declaration fraud Need to regularly check and supervising cost declaration documents, taking resolute measures, not accepting expenses without valid documents and exceeding the State's regulations

 Well-organized division of labor in the enterprise: is an important factor

to improve productivity as well as labor efficiency, contributing to the increase of overall efficiency of the business The rational and rational division of labor in the enterprise will contribute to the use and exploitation of the production and business resources of the enterprise, eliminating the waste of labor and machinery, and promote the short-term competence of each employee in the company, promote the sense of responsibility of everyone in the job, create a dynamic working environment in the company and achieve quality productivity High contribution to reduce product costs and increase profits for businesses

 Organizing well exploitation of goods sources and input sources for

enterprises

Input source and input quality for the business are very important because:

Tiêu đề	Profits and profit enhancement solutions at Tocontap Sundries Import Export Company
Người hướng dẫn	Nguyen The Vinh, Teacher
Trường học	Hanoi University of Industry
Chuyên ngành	Business Administration / Economics
Thể loại	Graduation thesis
Năm xuất bản	Not specified
Thành phố	Hanoi

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