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Indonesian Journal of Business Analytics (IJBA)
Vol.3, No.2, 2023:309-320
309
DOI: https://10.55927/ijba.v3i2.3771
ISSN-E: 2808-0718
https://journal.formosapublisher.org/index.php/ijba/index
Mini Review of Revenue: Profit and Growth
Endah Suci Damayanti
Universitas Bhayangkara Jakarta Raya
Corresponding Author : Endah Suci Damayanti endahsuci2505@gmail.com
A R T I C L E I N F O
A B S T R A C T
Keywords: Logictic,
Distribution, Procurement
Received : 09, February
Revised : 12, March
Accepted: 22, April
©2023 Damayanti: This is an
open-
access article distributed
under the terms
of the Creative
Commons Atribusi 4.0
Internasional.
Research Objectives to provide an overview of
existing results from previous research and
provide conclusions by researchers. The research
method used is a literature review derived from
existing scientific articles from various journals in
the world related to variables.
The results of research in this study provide
significant results with quantitative research
methods and mostly use qualitative methods with
the results of the researcher's perspective. The
researcher highlighted that in finance there are
other variables that can be used in the future by
researcher.
Damayanti
310
INTRODUCTION
In financial studies, we know about sales, profit and growth of a
company, salesof products or services to consumers in accordance with policies
or plans that have been made by the company, to succeed in sales, salespeople
must have an effective sales strategy and know the factors that affect sales
success. Profit margins are affected by cost of goods sold and cost observations
may not always be reflected in profit margins (Cheng et al., 2020), Factors—
factors affecting sales growth range from promotion to internal motivation and
retention of talented employees to indirect opportunities to invest in new
technologies and equipment in the production process. In addition, it benefits
from the learning curve and economies of scale provided by sales growth (Fazli
et al., 2013).
Profit maximization and growth are two competing business goals. It is
profit-oriented or growth-oriented, but not both, because it is difficult for
managers to achieve both goals at the same time. So there is a trade-off between
profit and growth (Lee, 2014), another opinion also states that maintaining a
business and competing with other businesses requires many things, including
strategy, new ideas, customer trust, even large capital. The value of a company
is influenced by factors such as taxation, company size, growth, uniqueness,
financial risk, profitability, dividend payments, and debt-free tax-free
(Hestinoviana et al., 2013);(Suryawan et al., 2021). According to (Fazli et al.,
2013) states that the effectiveness of financial management is determined by
profitability, liability management and financial management. Debt
management is measured as total debt to equity and the ratio of long-term
liabilities to equity. Profitability is measured by return on equity, return on
equity and return on capital invested.
Current business models vary and various hurdles are faced, there is an
opinion from (Nezami et al., 2018) that if trade declines and increasing pressure
from low-cost competitors, many business-to-business manufacturers have
moved from their previously successful product-centric strategies to more
service-oriented business models. The purpose of this study was to see and
analyze the influence between the three variables using review literature.
THEORETICAL REVIEW
Income
According to Revenue is the amount of money a business earns over a
period of time by creating goods or services. According to (Lam &; Lau, 2014),
revenue is anaggregate liran of financial benefits resulting from the normal
(economic) activity of a company during a period when the profit flow
generates cash flows unrelated to payments to shareholders.
Profit
(Horngren et al., 2002) Your revenue is greater than the sum of your
income and total expenses. This is also called net profit. According to (Hansen
&; Mowen, 2007) profit represents a company's trading income minus interest
costs, taxes, and research and development costs. The annual yield is presented
as profit and loss.
Indonesian Journal of Business Analytics (IJBA)
Vol.3, No.2, 2023: 309-320
311
Growth
The growth of the company is expected both internally and externally,
because good growth indicates the development of the company. From the
investor's point of view, the company's growth shows that the company is
profitable and the investor has decided to invest in the company (kusumajaya,
2011).
METHODOLOGY
This research uses qualitative techniques in a way that is relevant to the
literature. Literary studies are types or methods of academic writing in the form
of literature research. Theoretical analysis and analysis of relationships between
variables in books and journals from Mendeley, Google Scholar and other
online media. The journals surveyed are listed in the journal metrics table
below.
Table 1. Metric Journal
Author, years, and
title
Variable Used
Findings
Differences
With
This Study
(Consumer et al.,
2012)
Profit, Growth and
Sales Maximization
Variable : Profit
Variable :
Growth
Variable : Sales
Maximization
The retention rate
has been pushed
beyond the point
where the value of
the company is
maximized With
remarkable
ingenuity, Friend
and Puckett were
able to question
conventional
wisdom, but most of
the empirical
evidence still seems
to show that the
majority agree
(Kohtamäki et al.,
2013)
Non-linear
relationship
between industrial
service offering and
sales growth: The
moderating role of
network capabilities
Variable :
industrial
service
Variable : sales
growth
Variable : role of
network
capabilities
demonstrate that
active development
of comprehensive
service offerings
should take place in
conjunction with the
development of
organizational skills,
such as networking
skills, to create value
industrial
service
role of
network
capabilities
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312
and improve
performance
(Fazli et al., 2013)
SALES GROWTH,
PROFITABILITY
AND
PERFORMANCE:
EMPIRICAL
STUDY OF
JAPANESE ICT
INDUSTRIES WITH
THREE ASEAN
COUNTRIES
Variable :
SALES
GROWTH
Variable :
PROFITABILITY
there is no significant
difference in sales
growth between
Japan and ASEAN.
However, ASEAN's
profitability in the
ICT sector is better
than Japan's. The
analysis also
supports the Global
Information
Technology Report
published by
INSTEAD and the
World Economic
Forum, OECD
reports, and previous
literature studies. It
also has practical
implications for
business leaders and
owner-manager in
the ICT sector
(Nezami et al.,
2018)
Disentangling the
effect of services on
B2B firm value:
Trade-offs of sales,
profits, and
earnings volatility
Variable :
Service
Variable : Value
Trade-offs of
sales
Variable : Profits
Variable :
Earning
Volatility
Trade-offs are
important between
these mechanisms.
Although the ratio of
services
monotonously
accelerates sales
growth, it has a U-
shaped relationship
with profitability and
profit variability.
This effect also
depends on industry
and enterprise-level
factors. Industry
maturity positively
measures the impact
of service levels on
sales growth and
profitability. But the
scale of the business
Service
Value Trade-
offs of sales
Earning
Volatility
Indonesian Journal of Business Analytics (IJBA)
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313
adversely affects
service relationships
and profitability.
Lastly, industry
turbulence
negatively moderates
the effect of services
on profitability
volatility.
(Chaudhuri et al.,
2019)
The effects of
loyalty program
introduction and
design on short-
and long-term sales
and gross profits
Variable :
loyalty program
introduction
Variable : design
on short
Variable : and
long-term sales
Variable : Groos
Profit
LP adoption can
increase sales and
gross profit in the
short term (within
the first year), and
these positive effects
persist in the long
run (at least). three
years of driving).
However, the effect
on gross results
became significant
only in the second
quarter after the
introduction of LP,
and its overall effect
on results remained
significant even after
sales. Based on these
preliminary findings,
the results suggest
that offering LPs on a
tiered basis or with a
revenue mechanism
can provide a
significant increase in
sales and gross profit
for the company.
Overall, the study
shows that the
introduction of
strategically
designed LPs can
significantly improve
a company's
performance in both
the short and long
loyalty
program
introduction
design on
short
Damayanti
314
term.
(Cheng et al., 2020)
Analyst forecasts:
sales and profit
margins
Variable :
Forecast
Variable : Sales
Variable : Profit
margin
The four
performance
characteristics
associated with
revenue forecasts—
optimism, relative
accuracy relative to
benchmark forecasts,
forecast sub optimal
and serial correlation
of forecast error—
apply to sales and
profit margins. Sales
forecast generally
perform better than
forecasts margin
keuntungan.
Additional evidence
also suggests that
sales forecasts
perform better than
profit margin
forecasts in terms of
how their forecast
errors account for
errors in profit
forecasts and how
realized surprises
affect changes in
their respective
forecasts. We also
found that a better
information
environment as a
proxy for size
increased sales
forecasts more than
estimated profit
margins. All these
findings suggest that
forecasting profit
margins is inherently
more difficult than
forecasting sales.
Forecast
(Jablonski et al.,
Variable :
(1) Local food
local food
Indonesian Journal of Business Analytics (IJBA)
Vol.3, No.2, 2023: 309-320
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2022)
The profitability
implications of sales
through local food
markets for
beginning farmers
and ranchers
Profitability
Variable : Sales
Variable : local
food Markets
channels can be a
lucrative marketing
opportunity for
startups. (2) There
are differences in the
use of short-term and
long-term financial
performance
indicators, which
may indicate that the
promotion of lean
management
strategies is useful
for initial support. (3)
Starting with
mediated local food
sales works better on
average than selling
directly to
consumers. (4)
Diversification of
channel types in local
food markets does
not seem to show
improved economic
performance
Markets
(Oktaviyani &
Munandar, 2017)
Effect of Solvency,
Sales Growth, and
Institutional
Ownership on Tax
Avoidance with
Profitability as
Moderating
Variables in
Indonesian Property
and Real Estate
Companies
Variable :
Solvency
Variable : Sales
Variable :
Profitability
Solvency has a
significant and
positive effect on tax
evasion. However,
growth in sales and
institutional
ownership did not
affect tax evasion.
Then profitability can
moderate the
relationship between
institutional
ownership and tax
evasion.
Solvency
(Jang & Park, 2011)
Inter-relationship
between firm
growth and
profitability
Variable :
growth
Variable :
Profitability
Restaurant industry,
profit creates growth,
but growth hinders
profitability
Damayanti
316
(Lee, 2014)
The relationship
between growth
and profit: evidence
from firm-level
panel data
Variable :
Growth
Variable : Profit
Profit negatively
affects growth, while
growth has a positive
effect. Negatives
effects of the results
on growth have not
been previously
reported. We
interpret our
interpretation to
mean that the
institutional
environment has an
effect on the
relationship between
firm growth and
profits
(Hestinoviana et al.,
2013)
THE INFLUENCE
OF
PROFITABILITY,
SOLVABILITY,
ASSET GROWTH,
AND SALES
GROWTH
TOWARD FIRM
VALUE (Empirical
Study on Mining
Companies Which
Listed on Indonesia
Stock Exchange)
Variable :
Profitability
Variable :
Solvability
Variable : Asset
Growth
Variable : Sales
Growth
Profitability,
solvency, asset
growth and sales
growth affect the
value of the company
simultaneously. In
particular,
profitability and
sales growth had no
significant effect on
company value, with
a profitability
regression coefficient
(B) of 0.19 and sales
growth of 0.003,
while solvency and
asset growth had a
significant effect on
company value, with
B-solvency of 0.463
and sales. growth of
0.463 . 0.003. asset
growth -0.022.
Solvability
(Qiao et al., 2021)
The impact of
various factor
market distortions
and innovation
Variable :
Market
Distortions
Variable :
innovation
Three important
conclusions: 1)
Distortion of market
factors can
significantly reduce
sustainable income.
Market
Distortions
innovation
Efficies
Indonesian Journal of Business Analytics (IJBA)
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efficiencies on profit
sustainable growth:
From the view of
China’s renewable
energy industry
Efficies
Variable : profit
sustainable
growth
In addition, among
various factors,
including capital and
labor market
distortions, capital
market distortions
reduce sustained
profitability growth
more than labor
market distortions. 2)
The effectiveness of
innovation is
positively
significantly related
to sustainable
profitability growth.
In addition, low and
high innovation
efficiency are
significantly related
negative and positive
with sustainable
profitability growth
when separated from
a technical efficiency
perspective. 3) Low
and high innovation
efficiency inhibitory
effects have
significant negative
and positive effects
on the relationship
between market
distortion factors and
sustainable profit
growth
Source : Researcher (2023)
RESEARCH RESULTS
From the results of the elaboration of the three variables used in this
study, the description of dozens of scientific articles found many that state the
significance between the three variables in this study, using various research
methods and data analysis. Only one scientific article from the research results
(Hestinoviana et al., 2013) stated the results of his research that profitability
and sales growth did not have a significant effect on company value, with a
profitability regression coefficient (B) of 0.19 and sales growth of 0.003.
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318
In addition, there are several other variables used in the search for
researchers such as Market Distortions, innovation Efficies, Solvency, Solvency,
local food markets, forecast, loyalty program introduction, design on short,
Service, Value Trade-offs of sales, Earning Volatility, industrial service, role of
network capabilities
DISCUSSION
The results of the study above show that only one research result that is
not significant between the variables of profitability and sales growth does not
have a significant effect on company value, with a regression coefficient of
profitability (B) of 0.19 and sales growth of 0.003 from the results of the study
(Hestinoviana et al., 2013).
CONCLUSION AND RECOMMENDATIONS
That there are scientific articles related to the variables in this study, with
only one research result (Hestinoviana et al., 2013) stating different research
results, as well as the use of qualitative research methods of review and
quantitative literature with various analytical test tools.
The recommendations in this study still need reinforcement and provide
an overview that will be continued in other studies in the future. There are
other variables that can be put together in future research by other researchers
as gaps and new phenomena to produce research and contribute to the field of
finance, especially financial studies.
ADVANCED RESEARCH
There are other variables that can be put together in future research by
other researchers as gaps and new phenomena to produce research and
contribute to the field of finance, especially financial studies.
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