We use net income to measure profitability. (Net income and net profit are synonyms.) A good basic goal for your business should be to maximize net income, the “bottom line.”
Maximize your net income by increasing the difference between your revenues and expenses. Three ways to do this:
- Raise your prices.
- Reduce your costs.
- Increase your sales volume.
Furthermore, you cannot judge income just by looking at the balance in your bank account. Keep accurate books and records so that you can measure your profitability (following the above formula), and try out different strategies to maximize it.