(DO YOU) KNOW WHEN TO HOLD 'EM, WHEN TO FOLD 'EM(?)

"Nobody ever lost money taking a profit."

Bernard M. Baruch (1870-1965) American financier/political consultant

This is more about timing with "profit" covering everything from making money to deciding when to leave one job for another.

It's not as much about what you do as it is when you do it.

A Voyeur Or Participant Of Progress?

"We love to overlook the boundaries which we do not wish to pass."

Samuel Johnson

18th century British author

The sweet spot in business is being agressive enough to always be moving ahead.

Too agressive and a loss may mean the end of your business.

Not enough and everyone passes you by as though you were standing still.

How's your risk balance?

The Cost of Winning

"I was never ruined but twice; once when I lost a lawsuit and once when I won one."

Voltaire

18th century French writer/historian

How much more profitable might business be if there was a law banning lawsuits to settle disputes?

If those who would sue each other were forced to settle their differences without the use of lawyers.

It's Not What You Earn But How Much You Keep

"Revenue is vanity . . . margin is sanity . . . cash is king."

Unknown

There's an old sales joke about "losing a dollar on every item we sell, but making it up in increased volume."

I would imagine some CFO's reading this blog are not laughing at this, finding it all too common in their organizations.

They're right to be concerned.

Too much emphasis is placed on how much is sold, too little on how much is earned, and to make matters worse, many managers don't understand the difference between the two.

Do you?

Not What You Make, What You Keep

"Profits are an opinion, cash is fact."

Unknown

Each year my accountant and I would sit down just before year-end and plan how to close the books, taking into account the realities of income and corporate tax rules.

Nothing illegal, just maximizing what the company would keep. Obviously the less profit I reported the less tax I paid and while everything we did was legal, the process taught me how little value there was looking at a P&L when evaluating a company's performance.

Now I see a regular stream of start-up companies telling me not how much they will keep, but rather how much they will make.

There is a big difference.

Sales and Profit: Chicken or the Egg?

"Our inventions mirror our secret wishes."

Charles H. Duell
Late 19th Century Commissionaire US Patent Office

Too many business people focus on the sales and profit they hope will come from innovation and invention.

If those are their "secret wishes" they are missing the point.

Sales and profit are the result of successful innovation and invention. Invent and innovate product that fulfills the secret wishes of others and sales and profit will follow.

What are your secret wishes?