In today's competitive business environment, profitability plays a critical role in a company's long-term success. While maximizing profits is a common goal, achieving it requires a balanced approach that considers both revenue growth and cost management.

Beyond Just Numbers: A Holistic View of Profitability

Profitability is more than just a high revenue number. It encompasses efficient operations, effective cost management, and delivering customer value. Businesses that adopt a comprehensive strategy focused on these areas are better positioned to navigate a dynamic market and achieve sustainable growth.

The Importance of Profitability

Profitability is the lifeblood of a business. It allows companies to reinvest in operations, expand their reach, and create value for stakeholders. Additionally, strong profitability serves as a key indicator of a company's financial health and competitiveness.

Understanding Profit Margins: Key Metrics

• Gross Profit Margin: This metric measures the profitability of a company's core operations by calculating the percentage of revenue remaining after accounting for the cost of goods sold (COGS). A high gross profit margin indicates efficient production cost management and effective pricing strategies.
  
  
• Net Profit Margin: This metric provides a more comprehensive picture of profitability by factoring in all expenses, including operating costs, taxes, and interest. A healthy net profit margin demonstrates a company's ability to generate sufficient profit to cover expenses and deliver returns to investors.

• Cost Reduction Techniques: Implementing strategies like streamlining operations, negotiating better deals with suppliers, and optimizing resource allocation can significantly reduce expenses and improve a company's bottom line. By identifying and eliminating inefficiencies, businesses can enhance profitability and gain a competitive edge.

• Pricing Approaches: Pricing plays a significant role in profitability. Businesses can explore options like dynamic pricing models, product and service bundling, and strategic discounts to attract customers and increase sales. Analyzing market demand and competitor pricing can inform pricing decisions to capture value and potentially increase profitability.
  
  
• Sales and Revenue Generation: Driving sales and revenue is crucial. Businesses can consider expanding their customer base, launching new offerings, or entering new markets to generate additional revenue streams. Diversifying revenue sources and capitalizing on market opportunities can potentially enhance profitability.
  
  
• Customer Retention Strategies: Retaining customers is key for long-term financial health. Building strong customer relationships can foster loyalty, encourage repeat business, and generate positive word-of-mouth referrals. Investments in customer satisfaction and retention strategies may lead to sustainable revenue growth and profitability.
  
  
• Technology for Operational Efficiency: Technology can be leveraged to automate processes, analyze data, and improve operational efficiency. Utilizing technologies like artificial intelligence, data analytics, and cloud computing may help businesses optimize performance, potentially reduce costs, and contribute to profitability.
  
  
• Investing in Human Capital: Employees are valuable assets. Investing in training and development programs can enhance employee skills, productivity, and job satisfaction. Engaged and well-trained employees are more likely to deliver exceptional customer service, drive innovation, and contribute to overall financial health.
  
  
• Financial Performance Measurement: Regularly monitoring and analyzing financial performance is vital. Businesses should track key financial metrics, conduct variance analysis, and prepare accurate financial reports to assess profitability and identify areas for improvement. Data-driven decision-making based on financial insights can help businesses optimize operations and potentially maximize profits.
  
  
• Inventory Management Practices: Effective inventory management is crucial for cost control and profitability. Optimizing inventory levels, reducing carrying costs, and implementing just-in-time systems can minimize waste, improve cash flow, and potentially enhance profitability. Streamlining inventory processes and leveraging technology can contribute to operational efficiency and profitability.
  
  
• Growth and Diversification Strategies: Exploring diversification and expansion opportunities can open new revenue streams and drive profit growth. Businesses can consider entering new markets, launching complementary products or services, or forming strategic partnerships to expand their reach and capitalize on emerging trends. Diversification can potentially help businesses mitigate risks, seize growth opportunities, and enhance their competitive position in the market.
  
  
• Building Strategic Collaborations: Collaborating with strategic partners and alliances can create synergies, unlock new opportunities, and potentially drive profitability. Forming mutually beneficial partnerships with suppliers, distributors, or industry peers can grant businesses access to new markets, shared resources, and expertise to achieve common goals. Strong collaborations may enhance competitiveness, innovation, and profitability.
  
  
• Adapting to Market Dynamics: Staying attuned to market trends and consumer behavior is essential for business health. Businesses should conduct market research, analyze consumer preferences, and anticipate industry shifts to align their products and services with market demand. Adapting to changing trends and consumer needs can help businesses stay relevant, attract customers, and potentially drive profitability.
  
  
• Integrating Sustainability and Social Responsibility: Embracing sustainability and corporate social responsibility (CSR) practices can enhance a business's reputation, attract socially conscious consumers, and contribute to long-term profitability. By integrating sustainable practices into their operations (e.g., reducing carbon footprint, supporting community initiatives, promoting ethical sourcing), businesses can create value, build trust, and differentiate themselves in the market.
  
  
• Driving Continuous Improvement and Innovation: Continuous improvement and innovation are key drivers of long-term success. Businesses should foster a culture of creativity, experimentation, and learning to stay ahead of the competition and meet evolving customer needs. Encouraging innovation, adopting agile practices, and embracing change can drive growth, enhance competitiveness, and potentially maximize profits in the long run.

Achieving Sustainable Growth
Maximizing profits and achieving success require a strategic and holistic approach that encompasses operational efficiency, customer satisfaction, innovation, and financial management. By implementing effective strategies, leveraging technology, and fostering a culture of continuous improvement, businesses can not only enhance their profitability but also achieve sustainable growth and competitiveness in today's dynamic business landscape.

UAE-based e-commerce enabler Zbooni, has raised a $5 million Series A funding round led by an undisclosed London-based fund.

Founded in 2017, Zbooni enables small merchants to easily start, run and grow their businesses online, providing them with a range of business-focused services, such as mobile invoicing and payment solutions, digital storefronts in its marketplace, data insights, automated sales tracking and invoicing.

It initially started out as a chat commerce venture enabling payments via WhatsApp before launching its new e-commerce enablement services, signaling the growing demand for online selling.

Zbooni said that it had recorded a rapid acceleration in 2020, including 600 per cent in customer growth. It currently supports thousands of merchants, processing tens of millions of dirhams every month and has enabled its merchants to serve more than 150,000 customers.

Zbooni will use the funding to grow its team and fuel its expansion across its home market as well as in the Saudi and Jordanian markets.

“Zbooni is on a mission to help provide access to digital commerce tools, ultimately supporting our merchants to start, run and grow their business.

While we wish to keep the investor undisclosed, their reputation and track record speaks for itself, they have previously invested in some of the most successful emerging market growth stories - operating a fund of well over $1billion in assets under management.

Through this support, Zbooni will invest in people to develop even better products for our merchants and enhance the customer experience with best-in-class technology,” said Ramy Assaf, Zbooni CEO and co-founder.

The company was incubated at Facebook, the world’s largest social media network, and is backed by regional and international organisations, including Chalhoub Group, Middle East Venture Partners and B&Y Venture Capital.

“Our customers are the real heroes of this story, and we’re just scratching the surface of what we’re able to help them do,” said Assaf.

“We believe there remain millions of SMEs still left severely underserved across our geographies – we are here for them.”

source: wamda

Entrepreneurs can still make money in this environment. The opportunities may be in different industries than you usually work with, but many businesses still need your skills.

In times like these, full of unknowns, it can be scary for entrepreneurs and freelancers who’ve lost business opportunities, as well as workers who’ve lost their jobs or had their hours cut. However, there are still ways to make money during a crisis, even one like this with both significant health and economic concerns.

Personally, I’ve had around a dozen public speaking opportunities get canceled or postponed, which has been hard, but having gone through the Great Recession, I’ve learned some lessons and know I’ll make it through to the other side. You can too, and in some cases, you may find that this crisis creates an opportunity to take your career or business in a new direction that benefits you more in the long run.

Some ideas to earn money safely from home include:

1. Charging for content or content support

During this period, with so many of us staying at home, with more time on our hands, you’ll likely see a lot more content creation, such as with launches of new podcasts, YouTube series, courses, etc.

Some creators may be able to monetize this content by finding advertising — if, for example, you have a sizable social media following or can get enough podcast listeners. Or you could put your content behind a paywall and charge for access.

Others, however, need to be realistic about how much, if anything, they can earn from content creation. That said, you may still have the skills to support content creators, such as helping with writing, editing, graphic design, etc. Make sure you charge for your time. You can look at project and hourly rates on sites like Upwork to get a sense of what your fee should be based on your experience and the type of work you can do.

2. Monetize your knowledge

Related to creating content is jumping into the growing online education space for all ages. You may have the skills and experience to teach on sites geared toward young students, or you might have business knowledge that you can teach to other professionals, especially those at companies that have budget that would have gone toward attending conferences.

You can monetize your knowledge by creating a course on sites like Kajabi and marketing to professionals, or you can try to get paid directly by working part-time for an online learning platform. If you have an idea for your own course, see if it exists already on a platform like LinkedIn Learning. If it doesn’t, you could have a good opportunity to create something unique that others might be willing to pay for.

3. Find freelance work

Whether you’re a creative, a coder, an administrative assistant, or many other occupations that can be done online, there’s a good chance you can still find freelance opportunities through platforms like Upwork and LinkedIn.

Many businesses are still operating at full speed, such as in the technology sector and some food brands that are seeing strong sales due to demand at grocery stores.

Taking on freelance opportunities can be a great way to get your side hustle off the ground, whether that’s because you’re getting paid directly for your side hustle work (e.g, doing graphic design to eventually fund your own agency,) or because you’re using freelancing income to eventually fund another type of business venture.

4. Get active on social media

Social media will experience a renaissance in 2020 as people get back to being truly social and more connected online out of necessity.

While being more active on social media won’t necessarily lead directly to income opportunities, you can start making quality connections and planting seeds that can grow into ways to make money.

For example, you can crowdsource ideas for your business through social media, find new clients, find partners that help you grow your business, etc.

This is also an opportunity for a new wave of thought leaders to emerge, and while only a few will make it, now could be the time to build your personal brand so that you can gain a following.

Having an audience can then lead to monetization opportunities such as through affiliate links on your website, video views on YouTube, podcasting sponsorships through Anchor and article views on Medium.

Although this crisis has affected so many of us, it’s important to try to stay positive and look for opportunities where possible.

You may have to work harder and get creative, but with perseverance and quality work, you can find ways to make money in a crisis.

source: entrepreneur

It’s no secret that your people are the beating heart of your company.

Whether you’re a two-person pre-seed startup, or a 50-person strong Series B, a focus on people is vital.

With record-breaking FDI and increasing levels of M&As in the MENA region, there’s never been a more pertinent time to invest in your talent strategy. With that in mind, here are a few tips to get your talent strategy heading in the right direction:

1-BUILD A TEAM TODAY THAT’S FIT FOR TOMORROW

The team you put together now will be executing your key objectives for the next two, six, and 12 months.

Who you hire now dictates what your company is capable of achieving between now and its next significant phase of growth.

If you begin to hire incredible talent, you’re sending a signal out that you’re ready for growth.

2- BUILD A HIGH-SPEED, HIGH-QUALITY RECRUITMENT OPERATION
Top talent will have offers coming from multiple companies. Interesting startups with strong ideas can miss out on the best talent by making the recruitment process too long.

Build a process that will test the capability and compatibility of your candidates without making it tedious for them.

In the time you are deciding after your fourth-round interview, your candidate could be tempted elsewhere.

3- LOOK BEYOND INCREASING CAPACITY
When facing the need to hit growth targets, companies can go on a hiring spree to increase capacity. This can help you achieve your targets no doubt; however, you face a battle to maintain the growth that warrants these hires, and the potential disruption of having to part ways with recent hires once you achieve your desired growth- a real demotivator internally.

Being transparent with hires from the start is one way to alleviate the potential effects of such a strategy; however, looking further than the short-term and investing in talent to take you beyond this is a healthier option.

4- LOOK BEYOND THE SKILLS GAP
Look for people who will add value to your culture. Be honest if your team is lacking in a certain area that you might want to improve- for example, if you’re naturally risk-averse, look to bring someone who will challenge this.

Look to add value in areas important to you and your leadership team.

5- UP-SKILL WHERE POSSIBLE
Your business will turn from needing generalists to specialists. There will be tough conversations to have with people who have got you to a certain stage, but can’t take you to the next level.

Where one person may have been wearing multiple hats before, you will be looking to bring in experts in these separate areas that may make that original person unfit fit for a role.

If you see potential in these generalists, look to upskill them where possible so that they can remain in your company.

These founding people offer much more than their skills, contributing hugely to your culture, if you can lift them up to the level you need, it’s a win for everyone.

6- CREATE CLEAR PROGRESSION FRAMEWORKS
People join high-growth businesses because they want growth too– as such, design scalable roles for people capable of growing.

To avoid increasing attrition rates, make it clear where people could get to in your company. Making these roles visible is a big motivator, and it will help you retain current staff and attract new talent.

The rewards of investing in hiring and managing talent as you scale are vast. With both funding and exits on the rise in the MENA region, the impetus to invest in talent is clear.

These little tips outlined are part of a larger exercise to consider your talent strategy, and be thoughtful when you’re looking to scale.

source: entrepreneur