Why You Don’t Need to Know Profitability by Customer


Some prospects came to us and wanted to know their profitability by clients or by projects. To do that, we’ll need to tie off every expense to the right client or the right project. And, given enough time and effort, we certainly can do that. The more important question is — Is it worth doing it? Check out this episode and see why you don’t need to know your profitability by customer, and why sometimes is better off leaving things broken than fixing it in your business. Let’s jump right in!

Why you should run an imperfect business (Example)

[00:25] You probably wonder how leaving things broken can help your business. Here’s an example. A week ago, an entrepreneur came and asked us to help them tie off every expense to the right client or the right project. The idea is simple. If we can know exactly how profitable we are per client/per project. We’re able to only pick out the projects that we like or the projects that are profitable.

Yes, we certainly can do that. After putting a lot of time and effort, everything can be done. If you remember, we talked about how simplicity can lead entrepreneurs to profitability. To pick out every expense, break it apart, and tie it to the right client, and the right project. It definitely put more work and makes things become more complicated. The admin cost is going to be tremendous. And the more important question — How can you exactly benefit from it? Once we get that information, are you able to make the necessary changes in your business? Are you going to make a strategic decision because of it? Is that change can grow your bottom line?

The answer may not always be yes. If it’s not “yes”, we recommend that you’re better leaving it broken or the way it is.

Thanks for watching. Feel free to share any thoughts with us or contact us if you have any questions, we’re more than happy to help you grow profitably!