In the business world, we want to make money. Money, Profit, Revenue, Dollar, Dollars, Bills Yall. Any entrepreneur or CEO of a major corporation has the goal of growing their business, gaining a larger Market Share, and improving customer life time value. With the money, time and effort that they have invested with in a company, they want to see results. These results are the Return on Investment (ROI). This value is calculated by the following equation. The ROI is usually expressed as a percentage.
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For example, as a CEO I spent $500 to build my clothing business within two weeks I gained a total of $2000 from sales of basketball shorts. What is my ROI?
(2000-500/500) x100= 300%
In the above example I received a 300% ROI in my business. Which is great! These results are what CEO’s want to see. They want to see a higher revenue then what they invested.