Baking a Big Pi (π)

July 20th, 2011 Posted in Business Growth, Business Stories

Profit that is. The reason others purchase from you (to bake their own Pi). The reason your business exists. Your charter is to help others earn a bigger slice so that your Company gets more too.

You want your Company to be valuable?  Then you must generate a stream of consistent earnings growth over a period of years with performance better than most of your competitors.

There are exceptions to this but they are few: you may have assets i.e. intellectual property, products, land/building which are more valuable than your earnings stream or you may be in a hot market where, for a period of time at least, buyers will pay a multiple of sales to absorb your customer base and reputation. But, these are the exceptions. 98% of the time prospective buyers will value your business on expected earnings and they will base this largely on actual results.

So, business chefs, it’s all about Pi.

Here are some key ingredients:

  • High retention rate of profitable Customers
  • Selling more to existing Customers
  • Steady addition of new Customers (efficient/effective marketing and sales)
  • Maximize Gross Profit dollars (the right price/quantity balance)
  • Minimize expenses (increase high ROI spending, limit low ROI spending)

Fire up the oven, it’s time to bake Pi!

 

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