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Say I was a freelance salesman. I buy and sell expensive things that I can't afford. I line up the deal and make it happen. This month it's a cruise ship. It co
by tylerl 7y ago
Say I was a freelance salesman. I buy and sell expensive things that I can't afford. I line up the deal and make it happen. This month it's a cruise ship. It costs $500 million from the manufacturer in Amsterdam, but I can get a client in Dubai to pay $504 million delivered. I get a short term-loan which costs me $200k, plus short-term insurance for $400k. I buy the boat where it is for asking price, and pay $2.7mil to deliver it to the customer.
I made $700k on the deal, not bad. I moved more than half a billion. The _revenue_ number is huge but mostly irrelevant from my personal perspective. Almost all of it was money that was never mine, that I never made.
- TimTheTinker 7y agoYeah, your example stretches my analogy far past its breaking point. You’re right, revenue can be a pretty meaningless number. But where costs are relatively fixed, it can be helpful. In the case of companies, it can also show how much of the market a company has captured (when revenue == sales).