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ROCE for a Business Unit

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Your question is ROCE for a Business Unit. Take a moment with it on the right.

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Problem

Scenario

You are speaking with finance leadership about how to assess the performance of a business unit inside an industrial technology group. They want a simple way to compare profitability against the capital tied up in operations, especially where inventory, receivables, and fixed assets differ across units.

Question

How do you calculate and interpret Return on Capital Employed (ROCE) for a business unit?