{"id":1498,"date":"2013-06-21T00:11:20","date_gmt":"2013-06-21T00:11:20","guid":{"rendered":"http:\/\/www.shanecampbellcfo.com\/?p=418"},"modified":"2023-10-05T21:00:45","modified_gmt":"2023-10-05T21:00:45","slug":"is-my-business-efficient","status":"publish","type":"post","link":"https:\/\/www.b2bcfo.com\/shane-campbell\/is-my-business-efficient\/","title":{"rendered":"Is my business efficient?"},"content":{"rendered":"<p>There are several ways to look at efficiency.\u00a0 Here are a couple of my favorites.<\/p>\n<ul>\n<li>Gross profit percentage.\u00a0 In 30 years of finance, the truly successful companies I have worked with all had gross profit percentages of 40% or higher.\u00a0 The goal for 40% margins makes a lot of sense once you consider that at least 10% will be swallowed up by general and administrative expenses (aka \u201cblood-sucking overhead\u201d).\u00a0 Then there is sales and marketing.\u00a0 Companies rarely grow unless they are spending 15% on sales and marketing.\u00a0 Then there are income taxes to deal with.\u00a0 So as you can see, a 40% gross profit quickly dissipates, and if you are managing well, a 10% net can be achieved.\u00a0 Do you really want to work so hard for a dollar of sales if you get to keep less than 10\u00a2?<\/li>\n<li>Sales\/Revenue per employee.\u00a0 This metric gives an indication as to how effective your business is in generating revenue.\u00a0 Many businesses create additional revenue merely by adding to staff.\u00a0 Smarter businesses find ways to increase sales by having superior products, processes, marketing, etc. These companies get much higher valuations upon an exit.<\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"<p>There are several ways to look at efficiency.\u00a0 Here are a couple of my favorites. Gross profit percentage.\u00a0 In 30 years of finance, the truly successful companies I have worked with all had gross profit percentages of 40% or higher.\u00a0 The goal for 40% margins makes a lot of sense once you consider that at&hellip;<\/p>\n","protected":false},"author":25,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_editorskit_title_hidden":false,"_editorskit_reading_time":0,"_editorskit_is_block_options_detached":false,"_editorskit_block_options_position":"{}","cybocfi_hide_featured_image":"","footnotes":""},"categories":[29],"tags":[],"class_list":["post-1498","post","type-post","status-publish","format-standard","hentry","category-other"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.4 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Is my business efficient? | CFO Services | B2B CFO<\/title>\n<meta name=\"description\" content=\"Smarter businesses find ways to increase sales by having superior products, processes, marketing, etc.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.b2bcfo.com\/shane-campbell\/is-my-business-efficient\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Is my business efficient? 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