Revenue Leads to Growth—Where Is Yours?
23 Oct, 2012
Understanding why revenue is critical and how to grow it are vital to small business healthEditor’s note: This is the second in a six-part series on the six Rs. Read part one here.
The next building block of a successful small business is revenue; specifically, how best to establish a robust business model that generates profitable income. Understanding why revenue is critical to success is not hard: quite simply, without it, everything else is for nothing.
Generating and maintaining revenue and looking for new sources while being alert to threats to current revenue streams should be at the heart of what leaders do. Revenue leads to growth, helps drive profitability and ensures sustained longevity and success, and, as highlighted earlier, revenue depends on creating value that is both tangible and intangible.
Any small business or organization is a significant, long-term investment. Shaping and managing it requires the right strategy and the right structure. Keeping it fresh and vital requires a mix of entrepreneurial and innovative input. And each part of the business, including the tactics employed and the “business model,” must support the organization’s mission, underlying values and, of course, its growth.
Knowing how to grow revenues remains at the core of strategy and is often a more elusive task for leaders.
From the realm of revenue also comes the issue of generating, managing and maximizing resources. Does the organization fall into the category of business to business (B2B) or business to consumer (B2C)? Or is it a non-profit entity? Regardless, it needs resources to operate. Investors have their role but resources must be generated in ways that are permanent, self-sustaining and profitable.
Nothing else the business does will matter if revenue is not put front and center in business plans and operations. All business leaders know that generating, maintaining and protecting revenue streams are at the heart of strategy. This is easier said than done, as the difficulty lies in knowing how to achieve these goals.
Pages: 1 2