The basic idea of having a profitable business is to have more revenue than cost. That’s the equation for profit after all: revenue – cost = profit.
The difficult part of that equation is trying to increase your revenue and cut costs to maximize your profit. But sometimes you can’t do both. So, which one should be your priority to grow your business?
The answer depends on your business type, and what stage of growth you are in. Not to mention the current costs and revenues you have. If your current costs are much higher than a business of your size within your industry, you might need to trim some fat. On the other hand, if you have almost no costs but your revenue stream is similarly thin, you should look at more ways to increase your revenue.
Sometimes, these two ideas are contradictory. You can’t cut cost on your marketing, for example, if you want to get more customers and increase your revenue. So, it’s really important to know when and where to put your efforts.
For help to grow your business in a smart and efficient way, contact M1 Core Traction today!