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In stark contrast, some companies can continue to suffer spiraling losses even after investing a great deal of money each year in R&D.
For example, in 2003, telecom equipment maker Lucent Technologies was still facing losses even though it had been throwing more than billion a year into R&D since 1998.
It tries to find and make new medicines that can cure or reduce the effects of disease.
BP (British Petroleum) is at present the second-largest company in Europe.
On the other hand, what is deemed a healthy R&D/sales ratio depends on the industry and the company's stage of development.
Pharmaceuticals, software, and hardware companies, for instance, tend to spend a lot on R&D while consumer product companies typically spend proportionately less.
The large companies invest a lot of money in research and development (R & D) to find new and better, usually high-technology, products.
Companies often cite patent output as a tangible R&D success measure.Some companies see a payoff from spending heavily on R&D.Apple Computer, for instance, devoted large amounts to R&D during the company's unprofitable years of 19, but Apple saw earnings skyrocket with the 1998 launch of its successful i MAC product line.It is involved in oil and gas exploration, oil refining and the manufacture of petrochemical products. Successful small manufacturing companies in the UK often make expensive products. Originally designed for fishermen and farmers, these waterproof jackets are now fashionable in cities throughout Europe and the US. Quad Electroacousticsis is well-known for its expensive but high-quality loudspeakers and hi-fi equipment.These companies are successful because they use first-class materials, have excellent quality control and the workers are proud of what they make. Barber & Sons, the Morgan Motor Company, Quad Electroacoustics, Wilkin & Sons. Wilkin & Sons makes jams which British people cannot do without.