Posted under Money and Finance
from 1859 days ago

There’s something that most business owners don’t figure out until it’s too late – I call it the U curve.

The U curve is what it looks like when you plot your start-up business’ sales (on the horizontal axis) and your profits (on the vertical axis). When your business is small and your expenses are low, a little bit of sales can drive a pretty high profit.

As your business grows, you expect that your profit would keep growing with it – but that’s usually not the case. You see, once you get over that initial working-from-your-basement phase, you start to add overhead. Most companies in this growth stage add overhead faster than sales because this is when they have to start paying for things like an office, computers, a bookkeeper, a real phone system, insurance and… the list goes on. Most business owners realize these expenses are ...


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