Unrentabel

Unrentabel is an adjective used in several Germanic-language contexts to describe an investment, project, asset, or business activity whose expected or realized returns do not justify the costs required to pursue them. In English, the closest common term is unprofitable; in German, unrentabel is standard, and in Dutch contexts the counterpart is often onrendabel. The concept applies to both corporate projects and public investments.

Unrentability arises when costs—capital expenditure, operating expenses, maintenance—exceed revenues or the value of benefits over the project’s life. It is typically evaluated with profitability metrics such as net present value, internal rate of return, or cash flow analysis. If the present value of inflows is less than the outlays, or if returns do not meet a required hurdle rate, a project or asset is deemed unrentable under the chosen assumptions.

Responses to unrentability include termination, divestment, cost reduction, process improvements, or price adjustments. In some cases, an activity may be kept for strategic reasons, for example to preserve essential capacity, comply with regulations, or realize non-financial benefits like market presence or learning.

Notes: market changes, subsidies, or shifts in strategy can alter the profitability of a project, turning an unrentable venture into a profitable one, or vice versa. As with any profitability assessment, results depend on assumptions about costs, prices, demand, and discount rates.