Clivus: To answer your question - "Anyone know where they’re cost cutting? Expenses must be plateauing for the profit to be increasing."
In a well run company it is a numbers game. Uscom had a large fixed establishment cost in both time and money. It took a lot of dedication and work and quite a few years. - as those who have followed the company will tell you. Anyone trying to produce a competing product has to go through the same thing.
Now that much of this is behind them. The more they sell - economies of scale kick in - item costs become cheaper with volume production runs. The more they sell while holding the same fixed overheads - the higher the free cash flow and profit generated per item.
To grow the company you need to spend on research and development. To grow sales you need to spend on marketing system, regional offices etc.
It is managements job to balance all these competing factors - to deliver a prudent balance of Profit - Growth and progress. This is where the company is today.
Having to embark on a "cost cutting" program to make a profit, is to admit your business has become unbalanced and needs to be corrected.to restore proper business harmony.
Cheers
Add to My Watchlist
What is My Watchlist?
