October 21, 2012

Dear Catalog CEOs: Profit Sources

Dear Catalog CEOs:

This issue comes up, from time to time.  Look at the profit and loss statement below.  The profit and loss statement does not include fixed costs.

Now, you call yourself a "cataloger", right?  And you're still generating 64% of your net sales from your catalog.

But you're generating 42% of your profit from your catalog.

This is common.

Now, what percentage of your work day is spent thinking about the catalog.

What percentage of your work day should you be spending thinking about the catalog?

We have a disconnect.  We need to re-wire all of our employees to think differently about how we generate profit.  Our future efforts need to be aligned with the activities that generate profit.

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