Business Plan Vs Business Model Canvas Your costs that are fixed do not do that. They stay exactly the same no real matter what revenue does. why it is phone set, this is exactly. These are costs like lease, fees, resources, telephone, wages, insurance, etc. this is never considered by lots of business people. They simply lump almost all their costs together. Should you mix all of your costs together however, you might never create a precise strategy. Should you need to understand what your costs is likely to be and project your revenue greater, you've to split up variable and your mounted. Therefore, considering this theory, I would like to ask you a problem. In case your revenue increased 10% and nothing otherwise transformed, might your profit profit be exactly the same greater, or less? Revenue margin is % of revenue against revenue
You then are right should you stated the revenue profit could be greater. Why might your revenue not be secondary? You'd be correct should you stated due to the fixed costs. Work cost your content cost would have increased 10% your fixed costs might have stayed exactly the same. You introduced Business Plan Vs Business Model Canvas more income due to sales and also you invested 10 PERCENT more on variable cost, and substance, work to protect the additional revenue, however, you did not invest anymore in your fixed costs. Therefore, less general costs, might give higher-profit profit to you. Seem sensible?