Profitable Top Line Growth

Andy Birol, Birol Growth Consulting

Companies Either Grow Or They Are Sold

While financial gamers, schemes and scams have enabled many companies to avoid either profitable growth or a sale for years…

… ultimately one of these options is inevitable.

  • A company that is profitably growing is controlled by passionately committed owners and investors.
    Their firm is financially and operationally self-sufficient. There is no need to merge or look for investors.  Its leaders can reduce its credit line and pay down outstanding loans. The company has customers who are happy to pay for its valuable products or services. Over time, the company will build up retained earnings and become a creator of wealth. As long as its owners are confident and passionate they should never think of giving up their independence in running it or cashing out. Life is good!
Your company either profitably grows or is sold say Andy Birol.

Your company either profitably grows or is sold says small business growth consultant Andy Birol.

  • A company that is not growing profitably has flat or declining sales.
    Its costs and expenses are fixed or rising and it starts to lose money. The company begins to consume more cash than it generates. Owner, banks or investors have to subsidize the company through credit or by tapping any retained earnings. These leaders lose passion for their business as it is no longer self-sufficient. Clearly, its customers cannot or will not pay enough for the firm to delivery its products and services.  First, the company runs out of cash, then out of credit and finally must be sold.

There are only two buyers for a company that is not profitably growing:

  1. New owners and investors with ideas, cash and passion to return the company to profitable growth.
  2. Bankruptcy trustees who sell the company for whatever they can to pay creditors pennies on the dollar.

So companies either profitably grow or they are sold.

What’s it going to be for your company? Do you agree or disagree?


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Why Profitable Top Line Growth Now?

Before the financial crisis, most businesses could coast along and rely on their credit lines to make up for shortfalls in sales.

“Good” customers could be subsidized and customers who didn’t pay or went under could be ignored by just borrowing more cash. For the firm, slumping quarterly revenues and rising expenses could be carried forward by financial wizardry and leveraging a balance sheet.

While the lessons of doing business without credit and cutting expenses to the bone have been learned, how can one grow a business back to where it was and forward after the financial crisis? Without fads like buyouts, rollups and ESOPs, an owner, financier or organization should return to the oldest source of creating growth in the book. Sell more products and services and do so at a profit.

Why Profitable Top Line Growth Is Important, by Andy Birol

Why Profitable Top Line Growth Now? by Andy Birol

Profitable sales means focusing on:

  • Higher gross margins from differentiating your value and de-commoditizing your products and services profitably
  • Knowing that every sale you make is profitable by customer, order item or services
  • Managing your balance sheet for liquidity instead of credit where the biggest assets are customers’ predictable purchases.
  • Creating a wealthy company that can be sold for cash and secure the lifestyle of its owners now and later.

Profitable Top Line Growth is not a fad, or just a program to get by in the short term, but a way thinking about your business, investment or organization. It starts with knowing who is paying you for what value and continuously working to repeat this. It is a pay-as-you-go approach to growing your business that reduces dependence on borrowing money, and increases the wealth of a company and the security of its owners and all who rely on it.

Whether your business has major growth or returning to growth in its plans, this blog will focus on the tools, techniques and real-world examples for creating Profitable Top Line Growth!

Filed under: Business Growth, Profitable Top Line Growth, , , ,

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