SD: The net profit margin for those two businesses is 10% and 1%, and that’s my point.
In your example many investors would automatically assume that the 10% profit margin business NZRU is better. In fact when you take into account turnovers they are the same and if the 1% profit margin business WHS could squeeze in just one more turnover they would in fact be in front on net profit.
Turnover is another piece to the puzzle when combined with net profit margin.