Episode 4: Cash is King but Margin is Queen
The reason I’m covering this topic is because all too often I see small business owners – mostly those just starting out – focusing just on sales. All their activities are about getting the sale, and being paid to receive the cash (or the funds).
Whilst that is an extremely important part of your business to focus on, you need to look at your sales in conjunction with something else: your costs. And this is where margin comes in.
It is the margin on your sales that pays for all the overheads in your business, and will enable you to run at a profit, or a loss. I know this sounds glaringly obvious, but it is easy to lose of this, particularly in the chase to get the sale.