Financial Performance and Sustainability Efforts

In: Business and Management

Submitted By dannywriter15
Words 928
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Financial Performance and sustainability efforts
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Financial Performance and sustainability efforts Businesses are usually in business to make profits. The management takes a lot of time to evaluate the market and also the potential of the firm. The goals and objectives of most businesses are aimed at maximizing the profits they are currently getting. Some of the ways that have been used in the maximization of profits are increasing the products prices, getting cheaper labour and raw materials, and purchasing better machines for the organization. Increasing the prices of the products sometimes results in success but in most times it leads to low sales as the customers go for the substitutes which are much cheaper and affordable. Having cheap labour and raw materials is not always possible. As much as the business would like to improve its financial performance, measures taken should have a positive effect on the people and the environment. Profits are obtained from the subtracting the total input from the total sales. The sustainability of the business highly depends on the profits being made. The financial performance is not only important to the firm, but also to the shareholders and the investors. When a business has high returns, the shareholders get a higher share, and it also attracts the investors. Most business concentrates more in increasing the profits and just ignore their social responsibilities. A business that engages in sustainability activities has to use some of its finances. It incurs unnecessary costs that reduce the financial performance of the company. Such operations and also the management cost have been seen to cause adverse effects to the organization with no direct returns. The businesses rule state that a manager should use the business resources in activities that only benefit the…...

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