What is project profitability & its importance in success of a project

1
What is Project Profitability its importance in
success of a project?
2
What is Profitability?

• Profitability can be defined as the cash balance
  or amount left from revenue after subtracting all
  expenses like operating, employee salary etc.

3
Profitability in Projects

• Profitability helps a business owner or project
  manager to take the decision whether to take up
  the project or not
• To forecast profitability one has to take into
  account the project delay cost, employee working
  cost, operational cost etc. It will guide to
  determine the best price understand the
  profitability of the project
• Forecasting profitability of a current project is
  very tough cumbersome yet its a need of the
  hour.

4
Key factors

• Define the project opportunity
• Forecast project cost choose the best price
• Do a perfect project planning
• Hire a right team
• Pinpoint threats
• Do a project budget
• Do a project profitability analysis
• Monitor track project profits
• Use tools for better project management

5
Risks linked to Project profitability

• Substandard project planning
• Sudden resource changes
• Manager with less finance knowledge
• Poor resource management
• Uncertain financial issues

6
How to forecast project profitability?

• Do a proper budgeting for the project
• While doing budgeting always consider project
  delay costs
• Estimate employee cost on the basis of working
  hours in the project
• Always have some cash balance to meet uncertain
  expenses
• Use tool to forecast project profitability

7
The best tool which would help in project
Profitability is ProfitBoard
Knowing profitability of your projects is often
difficult. With ProfitBoard from SlickAccount,
you can tag every transaction, be it income or
expense to projects and project types. Once you
do that, with a single click you can quickly see
how much direct profit you have made from each
project. To know more about ProfitBoard visit
www.slickaccount.com
8
How it helps?
Once you have tagged the transactions, with
ProfitBoard it's really easy to understand the
profit of each project instantly.
9
ProfitBoard understands project pricing is
difficult. It takes all the projects into account
while suggesting your price. It shows all the
costs, depreciated asset costs, average delay
cost and loss from the delay and many more
parameters, so you always stay profitable
10
Project budgeting is often difficult and
error-prone via excel. ProfitBoard's simple
tagging and complex budgeting feature is a quick
way to budget and run your projects under
budgets.
11
Earning profit is the first foremost aim of
every business. In case web design companies the
only earning method is from projects. But a
improper or not so good pricing can harm business
profitability. Try above methods tool to
increase your web design business profitability.