It is easy for business-owners, their managers and salespeople to be seduced by good-looking sales turnover figures.
It is possible to achieve high turnover figures and yet still return a less-than-satisfactory profit.
The way to avoid this trap is to focus on 'contribution to profit' as one of the critical KPIs in all areas of your business.
By doing this you may be able to identify products and/or suppliers who are loss-creators rather than profit-makers. You may also highlight marketing initiatives and programmes that are not paying their way. Then you can do something about them.
Remember, if a business is profitable it can do lots of good things; if a business is unprofitable it won't be around very long.
(The up-coming post for Monday 16/1 is The 80/20 rule and time. It's about getting best value from your A class time.)
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