There is a vast difference between revenue and profit.

Revenue is the money generated by the sale of goods and / or services from a business.

Profit, is the combination of revenue and expenses or revenue less expenses.

Businesses and their operators can often fail to make the distinction between the two. They often make the mistake of believing that by generating more sales they will increase their profit.  This is a very dangerous link to make.  In fact by increasing your sales this may have the undesired result of increasing your losses.  This is especially true when a business has a negative contribution margin.

If you would like to discuss further please contact us:
McNamara and Co - Chartered Accountants, located minutes from the Melbourne CBD
www.mcnamaraandcompany.com.au/contact-us
Phone +61 3 9428 1062
Email admin@mcnamaraandco.com