Tips Nov 17, 2018 12:37

What is this club’s operating profit margin? If possible, could you tell me? (I’m embarrassed to say my company’s was -0.67% this fiscal year, haha.)

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木田(社長)
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Kida, the company representative, will answer. I’m very sorry for the extremely delayed response. I wondered, “What exactly is an operating profit margin?” and looked it up. It said: Operating profit ÷ sales = operating profit margin So I calculated it using our monthly sales and profits, and it came out to around 24%. However, this figure is calculated based on sales targets used to determine employee bonuses, so it’s considerably higher than the actual figure. According to our financial statements, it’s 2%. You didn’t ask about this, but our company has a bonus policy that says: “One-third of the profits generated during the half-year period will be divided among employees as bonuses.” That’s not exactly the wording, but that’s essentially how it works. The maximum bonus amount is determined based on each employee’s length of service. To pay the full amount, we calculate things like, “This month’s sales target needs to be 86.5 million yen!” Each day, the achievement rate is compiled by sales department and sent out by email. When the target is reached, employees receive a bonus of around 10,000 yen. We don’t include expenses related to future investments or things like security deposits for properties in that calculation, because it wouldn’t be fair to the employees to do so. Those are treated as genuine investments and excluded. By the way, regarding the -0.67% for the current fiscal year mentioned in your question, I imagine that’s the result of some exceptionally well-executed tax planning and investments. You seem to be quite the master of business management. Please feel free to ask again if you have any other questions.
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