Either way, the CEO will be happy as long as you lose less money than market analysts expected you to. Business isn't about profit or loss anymore - it's about meeting growth expectations.
David, this was never true, although some people thought it was before the dotcom crash. They were all talking about a "new paradigm", and look where they are now. Under various bridges.
At around that time I was asked to put together a series of financial projections in support of a bid for funding for a new fast-food chain. I did the projections, and discovered that however you looked at it, the scheme wouldn't work. "That doesn't matter", said the promoters, "we just need to show growth".
Then the bubble burst, and the institutions they had approached for funds suddenly took a literal "crash" course in economic realities. The money wasn't forthcoming.
Companies only go broke for one reason. They run out of money. If they aren't making a profit, they aren't making money. And if they aren't making money, they're losing it. That can't go on for long.
People talk about "tax breaks" and "tax write-offs" as though this is some sort of magical manna from heaven. Modern alchemy. But again it's rubbish. So-called tax breaks are no use at all if you don't have profits to offset them against.
Cash is king, and cash comes from profit. Ignore these words at your peril.
John
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