Factors of formation of profit of the trading enterprise

Abstract

Maximizing profit is the main purpose of any business. Profit is a generic indicator that characterizes the final financial result of production and economic activity of the enterprise, is the main source of further development of the enterprise. The study examines the main approaches to defining the concept of «profit». There are three main approaches used in the scientific literature: political, accounting, and regulatory, which complement each other. In the practical plane, profit is understood as an absolute figure, which is calculated as the difference between the total income and the total expenses of the entrepreneur. For a deeper understanding of the essence of profit, it is necessary to consider it through the prism of certain factors that influence its formation. The profit level of a trading company is influenced by a large number of different factors. The classification of factors affecting the level of profit is based on their division into external and internal. The classification of factors of formation of profit of the trading enterprise is given taking into account the specificity of the industry. For business executives, internal factors are of most interest because they can be directly influenced by the business. Research and purposeful management influence on internal factors of formation of profit, will allow executives to effectively manage profit of the trading enterprise.