The purpose of a business is to serve a customer and make a profit while doing it.
Let’s say you want a 10% profit. That means each 1% of the revenue that is left over as profit is 10% of the total financial output of your company (available to shareholders if not reinvested in capital expenses, growth, paying down debt, inventory, receivables or new employees).
Offense is maximizing revenue with sales and marketing-related activities. Defense is delivering your product or service efficiently and watching the expenses and managing the money well.
So, can you study your Income Statement (aka Profit and Loss Statement) and find where you can save (stop wasting) 2% of your revenue? I mean if you want to make a 10% profit, then you are spending 90% of your income. Can you find 2% savings in the 90%?
If you can, you have just increased the total financial output of your company by 20%. It’s like having 20% more of the business that you already own!
Right?
Let’s say your goal is 10% profit and you feel short – say you only had 4% profit. Now with the 2% savings you found and acted to make real, you have increased the total financial output of the company by 50%.
Right!
Fun!
Simplicity still works 🙂
Recently I made some changes to our business model that I believe will help with our bottom line. Sometimes putting the cart before the horse isn’t the best idea. I think I speak for everyone when I say we are all very grateful for Mark Daconto!