Good Revenue vs. Bad Revenue: Why It Matters.

How to Secure Sustainable Profits and Cash Flow for Long-Term Success.

Good revenue is the lifeblood of any business. It's the kind of revenue that fuels growth, generates profits and cash, and sustains long-term success. Bad revenue, on the other hand, is like junk food for your business. It may seem good in the short term, but it can lead to cash flow problems, decreased profitability, and a lack of sustainability.

So, what is good revenue? It's revenue that comes from customers who value your products or services and are willing to pay for them in a timely manner. It's revenue that contributes to the overall profitability of your business and allows for sustainable growth. It's revenue that comes from repeat customers who provide consistent revenue streams and is cash generative to help build a stable business foundation.

On the other hand, bad revenue can come from low-margin projects, customers who are slow to pay or dispute invoices, or projects that have high overhead costs that eat into profits. Bad revenue can ultimately harm your business's profitability, cash flow, and long-term success.

For main contractors and subcontractors, good revenue comes from projects that have reasonable profit margins built in at tender, strong project management, and timely payments from clients. By carefully selecting projects that have the potential to generate sustainable profits and cash flow, and by having strong systems and processes in place for excellent project management and delivery, smooth invoicing, and robust cash collection, contractors can secure good revenue and ensure long-term success.

As David Finkel said, "Good revenue is revenue that is profitable, sustainable, and predictable." By focusing on good revenue, contractors can achieve profitability, generate positive cash flow, and build a sustainable business that can weather any storm.

So, don't settle for bad revenue. Instead, focus on securing good revenue by providing value to your customers, carefully selecting projects, and having strong systems and processes in place. Remember, good revenue is the fuel that powers your business and drives long-term success.