Research and improvement of business profitability administration of "Eco-dim Development" LLC
Students Name: Buk Roman
Qualification Level: master (ESP)
Speciality: Management
Institute: Institute of Economics and Management
Mode of Study: full
Academic Year: 2023-2024 н.р.
Language of Defence: англійська
Abstract: The results of an economic entity’s activity encompass numerous economic indicators, among which profit is the most important indicator. Profit, as the main financial indicator, plays a key role in ensuring the financial stability and liquidity of an enterprise, serving as the financial foundation for its growth and development. As a driving force of economic activity, profit acts as a catalyst, motivating entrepreneurs to engage in financial ventures, thereby contributing to the development of the socio-economic system. To ensure sustainable development and stability of an enterprise, it is necessary to pay close attention to optimizing income, expenses, and sources of financing. Therefore, creating an effective profit management mechanism at an enterprise is extremely necessary, as it not only ensures the prosperity of the enterprise but also contributes to the holistic development of the country’s economy. In the conditions of war, Ukraine has found itself in an uncertain economic and political environment. Such an environment forces most economic entities to conduct their activities taking into account various influencing factors, including the unpredictability of the situation’s development in Ukraine, the unpredictable actions of the state, limited capital, reduced customer solvency, and a number of other elements shaping the economic landscape. In light of these circumstances, the research topic becomes especially significant, as it is aimed at considering the intricacies of managing enterprise profitability in today’s challenging conditions. The administration of business profitability holds a key place in the broader context of enterprise management, as its primary mission is dual: to promote effective profit generation and to optimize its distribution wisely. It is important that in every aspect of the enterprise’s activities, the decisions made by the management have a significant impact on the level of profit. Therefore, the profit management system must be inextricably linked with the overall enterprise management system. Such unity expands opportunities for development and opens new avenues for attracting financial resources [3]. The foundation of building an effective profit management system for an enterprise lies in several guiding principles: - **Principle of Integration.** This highlights the importance of aligning the goals of the profit management system with the overall strategic development goals of the enterprise; - **Principle of Continuity.** This emphasizes the urgent need for the continuous functioning of the profit management system, considering the ongoing activities of the enterprise, etc. The goal of this work was to identify the features of administering the business profitability of LLC "Eco-Dim Development". The object of the study is LLC "Eco-Dim Development". The subject of the study is the possibilities for improving the administration of business profitability. **Main Content and Obtained Results of the Qualification Work** The work consists of four chapters. Specifically, the first chapter describes a review of literary sources and the regulatory framework on the problem of administering business profitability. In the context of writing the second chapter, the features of administering business profitability were researched. The production and economic activities of LLC "Eco-Dim Development" were analyzed. The trading activities of LLC "Eco-Dim Development" were examined. The features of administering business profitability for LLC "Eco-Dim Development" were characterized. The third chapter of the work analyzes the activities of LLC "Eco-Dim Development" in the following areas: general characteristics of the activities of LLC "Eco-Dim Development"; characteristics of its management system; diagnostics of the production-economic and foreign economic activities of LLC "Eco-Dim Development"; analysis of problems, level, and factors affecting the state of business profitability in LLC "Eco-Dim Development". The fourth chapter of the work contains recommendations on administering business profitability at LLC "Eco-Dim Development". The practical significance of the obtained results lies in the improvement of methods for administering business profitability at LLC "Eco-Dim Development". The development of effective directions for improving enterprise profitability management in the modern business environment requires a comprehensive approach that takes into account both internal and external influencing factors. It is important to emphasize the significance of internal factors, which are under the direct control of the company, in shaping efficiency and profitability. The proposed directions cover a wide range of actions - from implementing proper personnel policies and optimizing sales practices to cost management, improving product quality, minimizing losses, introducing innovative marketing methods, updating business models, maintaining constant vigilance, and optimizing internal operations. These directions have significant practical value, allowing businesses to increase their profitability and strengthen stability in conditions of economic instability. The volume of other operating income in 2022-2023 also tends to increase by 163.89% in the reporting year compared to the base period, amounting to 46 thousand UAH, which is positive. The income structure of LLC "EKO-DIM Development" in 2022-2023 is presented in Fig. 2.1. The diagrams show that the net income from product sales prevails in the income structure of the enterprise, with a trend towards increasing its share in the income structure (94.61% in 2022 and 94.85% in 2023). The smallest share falls on other operating income of the enterprise (5.39% in 2022 and 5.15% in 2023), which tends to decrease accordingly. Administrative expenses of LLC "EKO-DIM Development" in the reporting year increased by 912 thousand UAH or 1725.55% compared to the base year, which is negative as the growth rate exceeds the growth rate of net income. The enterprise should review the feasibility of such an increase. Other operating expenses of LLC "EKO-DIM Development" almost doubled by 29 thousand UAH or 180.56%, which is negative as it exceeds the growth rate of both administrative expenses and net income of the enterprise. It is advisable to review the justification of such expenses.