Service Provider with Recurring Revenue: Grow Profitability, Cash Flow and Cash
This company was seeing top line growth of 20-25% for 2-3 years, but the co-founder/CEO was frustrated by the lack of growth in his profits and cash in the bank.
Analyzing the gross profit margin of the company’s key product lines, CFO Options helped them grow gross profit margin by over 40%. This was accomplished by focusing their sales efforts on the highest margin products and working to decrease cost of goods sold on all significant product lines.
Establishing and measuring actual performance against budget, we helped them significantly reduce the increase in overhead spending which had been growing nearly in direct proportion to revenue.
After 5 ½ years, this company’s revenue grew 84%, its operating profit margin increased by 355%, its Gross Profit Margin grew by 95%.