Revenue Is Vanity Profit Is Sanity Meaning

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Revenue is vanity profit is sanity meaning. You need to be able to understand their true often hidden meaning. We are talking about did you ever hear the expression revenue is vanity profit is sanity but cash is king exactly. In fact many showed consistent losses when measured in net profit terms. So while obviously important to grow customers and sales chasing revenue at the cost of all else is vanity and a potentially fatal blunder.

The problem is exacerbated by the fact that the numbers by themselves can be sometimes misleading. Turnover is vanity profit is sanity but cashflow is king forget this quote at your peril. Andi andilonnen co uk or call 07921 252758. Interested in becoming more financially savvy.

An elegant quote that encaptures the spirit of the basic financial numbers is this. I know companies. In the midst of busyness of running your company you should have a holistic understanding on the 4 chapters so that the fruits of your labor are safeguarded enhanced and ultimately get the valuation. Cash flow is reality.

Published on september 21 2015 september 21 2015 142 likes 17 comments. You couldn t have said it better myself. Cash is reality let s elaborate on those. The owner of the business would usually reach for the profit and loss statement while the accountant wanted the balance sheet.

We have to look at both margin and the cost of generating that revenue. In a previous life when i owned a company that implemented accounting software i noticed something often happened when we ran the first set of financial statements. Cable television industry most cable television operators earned zero profit. We re going to dig into that and talk about cash and cash flow.

So now you know why turnover is vanity profit is sanity and cash is reality. I m going to ask you a few questions here just to discuss it. A little known fact is that at the dawn and early growth of the u s. Revenue is only the bluntest of instruments when it comes to measuring business health.