How can I identify the reason for my project's loss?

Important points I encounter daily with medium and small businesses, and I’d like to clarify them for you... What does it mean when your sales are good but you’re not holding cash? Pay attention here:

Profit = Revenue - Costs

Make sure your costs are less than your revenue, and this is not simple.

Revenue is the sales, and sometimes the problem is that the price is incorrect – it’s less than the cost, or the sales quantity has not reached the break-even point.

As for costs, there is something called the gross profit margin, which is the difference between the sale price and the cost of goods. This is simple, for example: if you buy a product for 100 and sell it for 125, the profit margin is 25%.

The difficulty lies in the net profit, where all other costs are included in this calculation. If, in the previous example, the other costs are 35 SAR, then the total costs would be 135 SAR, and you're selling for 125 SAR. How do you calculate net profit?

You must use an accounting program accurately, or you can use Excel as well, or you can use Jadwa Cloud for future planning processes at jadwa.net.

You need to account for all costs, such as:

• Bank commissions, for example, 2.5%
• Shipping costs for returns in case the customer does not accept the product
• Commissions for intermediary sites like Noon and Souq
• Marketing – administrative and general expenses – product damage

Businesses are no longer as they were before; they require a lot of accuracy, planning, and knowledge to make the right decisions.

I wish you success!