About the growing gap between revenue and profits

Although your revenues play a significant role in determining if you have a viable business, your profits are far more important. The lower the gap between you revenues and profits means the better your business will function.

Although some only look at the profitability of your business, your revenue helps you sustain your business, if you know how much revenue you are able to generate from every dollar you spend trying to get a new client. You may want to spend more than the initial payment you’ll receive to get the client based on our earlier post of calculating the life time value of your client.

The greater your revenue the more likely you will be able to run a sustainable business, even if your profits are low, you will need to find ways to automate and reduce your overall cost.