From manta.com retrieved May 15th
from Lucidity SBM May 13th
If gross profits are doing well, but net profits are approaching the red line. Have a look at activities that will:
* Reduce in-house (fixed) Costs
* Increase Sales (revenue)
* Or a combination of both
With gross profits doing well you’re making money, but letting it slip through you’re fingers if net profits are down.
By increasing sales or revenue, you are increasing gross profits and also adding more volume to spread out your fixed costs. This reduces unit cost per product, increasing net profit! Any additional cost cutting measures you can implement is icing on the cake.