You buy something for 100 and sell it for 200. On paper you are delighted with a 100% profit. In reality, you may already be running into a loss, not just on this transaction but on the customer, the vendor or even the market segment as a whole.

The problem is simple. Businesses often look at selling price minus purchase price and call that profit. But in a real business environment, cost is far more complex. Let us look at where the illusion of profit disappears.

Accurate inventory management and accounting compliance through structured ERP classification

Inventory plays a critical role in every product-driven business — not just operationally, but also financially. Mismanagement of stock can lead to inaccurate reporting, operational bottlenecks, and even legal consequences related to tax and compliance.