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> Revenue should be the most important metric for people who want to make money. That's inarguable. Revenue is a good start but at some point you need to consi
by josephlord 13y ago
> Revenue should be the most important metric for people who want to make money. That's inarguable.
Revenue is a good start but at some point you need to consider profit. And yes, I have been in a room where someone proposed making up the per-unit loss through greater volume (on physical goods).
- pestaa 13y agoDo I understand your comment that somebody thought multiplying per-unit loss will actually lead to profit?
- edanm 13y agoThis is surprisingly less common than you think. Most people don't have a very good grasp of business, and many many businessman have a "sales mentality" that insists that selling as much as possible is the best way to grow a business (while completely ignoring margins, which are what is actually important).
- josephlord 13y agoYep. (Although I think you mean "more common" or "less uncommon"). It is what can happen to sales people especially when bonuses/performance reviews are based on sales not profit.
- a-priori 13y agoI hope, for their sake, that they were banking on some sort of economy of scale where increasing volume would decrease per-unit costs and therefore negate the per-unit loss...
- josephlord 13y agoThey may have been hoping that the economies of scale could work but they were arguing with people who knew they wouldn't. There may have been a language gap though I don't think that was all of the problem.