Numbers, numbers, numbers!
That’s what it boils down to and that’s what life revolves around. Have control (where possible) of the numbers and the rest will follow.
It’s like cycling – power, cadence, maximum heart rate and weight.
Weight loss – calories in, calories out and type of foods consumed.
Politics – rate of inflation, unemployment and balance of payments.
For business – turnover, gross profit percentage, net profit and tax.
Control the controllables as the saying goes. There are some things that cannot be controlled – rates of tax as set by legislation. We need to accept this and concentrate on what we can influence. Turnover, mark up and expenses. “Turnover is vanity, profit is sanity and cash is king” as another saying goes.
Anyone can have a company with a turnover of £10,000,000, but whether it makes a profit is another matter! Could be selling £20 notes for £10!!
Similarly, a company can have a profit of £10,000,000 but until that cash is sitting in it’s bank account, it is still vulnerable.
So what are we saying :-
Concentrate on sustainable turnover
Ensure mark-up is correct – whether it is raw materials or labour costs
Don’t let your expenses get out of hand – think about it today, and see if still needed in the morning
Accept what we cannot change and move on.
Remember that the expert on anything was once a beginner.