profitability
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profitability
An economic indicator that describes the relationship between profit and invested capital over a specific period, and thus measures the earning power of an investment or a company.
Vor der Entscheidung prüfte der Investor sorgfältig die Rentabilität des gesamten Projekts.
Before making the decision, the investor carefully examined the profitability of the entire project.
The word is derived from the adjective 'rentabel' (profitable). The ending '-ität' is typical for forming nouns from adjectives and describes a quality or state.
Eine hohe Rentabilität ist das Ziel jeder unternehmerischen Tätigkeit.
High profitability is the goal of every business activity.
'Rentabilität' (profitability) is a technical term from economics and finance. It is rarely used in everyday conversation.
Der Geschäftsbericht analysiert die Rentabilität der einzelnen Abteilungen.
The annual report analyzes the profitability of the individual departments.
In an economic context, 'Rentabilität' (profitability) is often combined with verbs such as 'berechnen' (to calculate), 'prüfen' (to examine), 'steigern' (to increase), or 'verbessern' (to improve).
Das Unternehmen sucht nach Wegen, um seine Rentabilität zu steigern.
The company is looking for ways to increase its profitability.
efficiency
'Effizienz' and 'Rentabilität' both have to do with a good relationship between input and result. 'Effizienz' is more general: it is about using little effort, such as little time, energy, or money. 'Rentabilität' is an economic word and refers especially to whether invested capital pays off and generates profit. The words can be confused because an efficient company can often also be more profitable. But efficiency alone does not automatically mean profit. A machine can work very efficiently, but the investment can still be not very profitable.
Mehmet vergleicht die Rentabilität der Investition, bevor er sein Geld anlegt.
Mehmet compares the profitability of the investment before he invests his money.
Im Lager steigt die Effizienz, wenn die Waren besser sortiert sind.
Efficiency in the warehouse increases when the goods are better sorted.