Can Profit replace Turnover?

Just about everyone has heard the saying “Turnover is Vanity – Profit is Sanity”.

It is undoubtedly true, but you can’t have the second without the first.

In the present economic climate many organisations are suffering reduced profitability through a reduction in turnover, due to a lack of demand for their products or services.

In many instances, they are faced with fixed costs, which in percentage terms increase as a proportion of turnover, as turnover drops. The higher the proportion of fixed costs are to turnover, the harder it hurts! So is there a way to find additional profit to replace the reduction in turnover?

After you have reduced working hours, trimmed staff resources, and generally battened down the hatches, all that is left to look at are your non-strategic costs.

Depending on your level of profitability, you may be surprised at just what a modest £20K saving a year can amount to in equivalent turnover needed to generate that very same profit. Click the PDF link below to have a look at a graph demonstrating exactly what I mean. If you are a high turnover low margin business, the effects are massive.

http://www.expense-reduction.co.uk/wp-content/uploads/2010/01/Turnover+profit.pdf

Now that you have trimmed your staff resources though, how are you going to find the time to look at your non strategic costs? Well, that’s exactly where we can help. We provide the expertise, time and resource in finding that additional profit on a no-risk basis, since we are only paid upon success. See the link below to see how we help to reduce costs and find that additonal profit.

http://www.expense-reduction.co.uk/about/