Revenue vs Profit - which to choose?
Look for more profit instead.
Revenue isn't your success barometer. You can have 2 million of revenue and 1.999 million in expenses.
Barely a dime for yourself.
What is important is to stabilize your profit before you grow.
How? Here are 3 ways to do it:
Optimize your revenue - find ways to increase your revenue other than looking for more customers
Optimize your expenses - find redundant & unnecessary expenses
Optimize your processes - are they efficient? if not, you’re losing money.
These are the questions you should be able to answer :
do you have the right number of people?
are your processes simple and effective?
are your strategic decisions driven by relevant KPIs?
do you have leaks because you lack proper internal controls?
can one new tool replace the dozen ones you currently have?
is your process to take on a new client easy and fast for them ?
You can't fix what you don't know need fixing. But if you feel something might not be right, it probably isn’t. Investigate and find where that feeling comes from.
Most people will tell you to ignore your gut. I tell you to use it in combination with reliable objective data.
Download this free Financial Dashboard so you can
Monitor your financial health year on year and visualize how you’re doing
Spot variations so you can head off oddities before they become problems.
