Select Page

Profitable
Growth

Every entrepreneur works to implement choices that target growth. Not all of them, however, refer to profitable growth.

The difference exists in the distinction between revenue and profitability. Both terms are accounting metrics in the analysis of a company’s financial success, but there are distinct differences between the two.
Revenue is an absolute value determined by the amount of income and expenses incurred by a company. Regardless of size, scope of business, or sector in which it operates, the goal of a company is always to generate revenue.

Every entrepreneur works to implement choices that target growth. Not all of them, however, refer to profitable growth.

The difference exists in the distinction between revenue and profitability. Both terms are accounting metrics in the analysis of a company’s financial success, but there are distinct differences between the two.
Revenue is an absolute value determined by the amount of income and expenses incurred by a company. Regardless of size, scope of business, or sector in which it operates, the goal of a company is always to generate revenue.

Higher revenue does not imply higher profit

Although a company can generate a higher revenue, this does not necessarily mean that it generates a higher profit. While revenue is an absolute value, profitability is relative. It is the metric used to determine the extent of a company’s profit in relation to the size of the business. Profitability is a measure of efficiency and, therefore, of the success or failure of the company itself.

We often underestimate the signals that indicate an inefficient use of resources and capital. Some risks are hidden, for example, in moving away from the core business, opening up to new markets, managing cash conversion, but also in acquisitions and operating processes that have not been reviewed for some time.

To increase profit focus on increasing efficiency…

…with the right people. Your company growth will only be profitable when you simultaneously reduce costs and increase efficiency. However, realising such fundamental changes that affect both employees and managers takes a lot of courage, commitment and expertise.

Having to redefine roles and let go of seeking security in the tried and trusted presents a serious risk. Creating the necessary motivation and reducing the risk takes a seasoned executive with an outside-in perspective, who already successfully managed comparable situations.

Some examples of actions to improve profitable growth can be:

  • reinforce companies, business units, businesses or non-performing operating functions
  • substantial growth in the value of the business
  • increase profits, reduce costs, increase returns or reduce working capital
  • enter new markets, specialised channels or sectors, or open offices or production sites abroad
  • find additional resources to manage or execute the work

A successful, proven methodology
to drive business growth

During 30 years of activity aimed at supporting the growth of its client companies – and also thanks to its qualified and active community of managers all over the world – the EIM Group has developed an integrated approach for the accelerated and sustainable development of profitable growth, with results happening already in the short/medium term.

An approach aimed at measuring, professionalising and optimising all the business processes already in place where the company operates with products/services.

A successful, proven methodology
to drive business growth

During 30 years of activity aimed at supporting the growth of its client companies – and also thanks to its qualified and active community of managers all over the world – the EIM Group has developed an integrated approach for the accelerated and sustainable development of profitable growth, with results happening already in the short/medium term.

An approach aimed at measuring, professionalising and optimising all the business processes already in place where the company operates with products/services.

Get in touch with us

Together we can find the solution you are looking for.