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Profit Optimization – WHAT and WHY Optimize Your Company Profits

Hope you all are doing well in your business, enjoy the fruit of your labor, having good time with your family and friends and that’s what we all envisage when we established our companies.  But would you like your company to make more money with the resources you have?  Do you think that your company produce optimal profits? Do you think that you can increase your company profits without increasing your revenue?

When CEOs and Business owners want to increase profits, usually the first thing that comes to mind is to increase revenue. They spend so much effort to penetrate the markets, spend money on advertising and promotion but Increasing revenue is not equal to more profits.  Please refer to my article on Increasing Revenue is not equal to more profits. Do you think your company profits is optimal?

The term profit optimization may not be very popular yet but this is the ONE thing you need to do to get more money in your pocket with little investment.

So WHAT IS PROFIT OPTIMIZATION?

Profit optimization is finding ways to increase your profit with the available resources under the given constraints and to make the best use of it. 

To make it easier to understand:

Production machine in the factory is running at 5,000 units per month, assuming we have the demand for the product and the machine is running at full capacity, how are we going to optimize the machine so that it can run at 6,000 units per month.  The plant manager might lubricate the machine better, schedule maintenance at more regular time, change the part more regularly, reduce the down time etc.

Based on the information above, I hope you have better understanding of WHAT profit optimization is. 

The second question people ask is

WHY you should optimize your company profits?

I would say no body rejects more money and more profits.  But WHY do you need to optimize your company profits?  Imagine all the benefits with more profits the company can generates.

Let’s dive in.

Reason #1: Put more money in shareholders’ pocket

With more profits the company makes there are many options on how the profits shall be distributed.  One of which is to distribute it in the form of dividend and the shareholders’ can use it for leisure, investment etc.

Reason #2: Higher bonus and pay for CEO and employees

As the company makes more money, it can pay better and higher bonus to its CEO and employees.  It can attract high caliber employees.

Reason #3: Increase Company Value

As the company profits is higher the company valuation is also higher even though the Price Earning multiple is the same as the Earning part is, resulting in the higher valuation of the company.

Reason #4: Grow The Business

With more profits and money in the company, CEOs and business owners can grow the business, increase sales and utilize it to finance working capital or invest in expansion of capacity.  It makes the company grows bigger and bigger.

Reason #5: Reduce the company debt faster

More profits and more cash flow will allow the company to pay down debt faster, which will further reduce the interest expense and makes the company healthier.  This is especially useful when the company is at very high debt level. 

Reason #6: Higher Return on Investment (ROI)

With the same investment but it generates more profits and more cash flow the return on investment is higher. 

The next question to ask is

HOW do you optimize your company profits?

There are 3 steps to massively increase your company profits, which I call HRS Systems

1. Helicopter View (H)
2. Determine Root Cause Problems (R)
3. Solution – Optimize your company profits (S)

As each company situation is different, we need to understand the business holistically and take helicopter view.  After we understand the company’s operation, we determine the Root Cause Problem, this phase is important as determining the RIGHT root cause problems will enable us to provide the RIGHT Solution to Optimize your company profits.

In many cases Profit Optimization can be achieved from

• better efficiency
• better internal control
• more orderly business process.

learn more on HOW TO MASSIVELY INCREASE YOUR COMPANY PROFITS in my free VIDEO training

Summary

In summary, Profit Optimization helps your company to make more profits using the available resources. 

• Reason #1: Put MORE MONEY in shareholders’ pocket
• Reason #2: HIGHER BONUS and pay for CEO and employees
• Reason #3: INCREASE Company VALUE
• Reason #4: GROW The Business
• Reason #5: REDUCE the company DEBT FASTER
• Reason #6: HIGHER Return on Investment (ROI)

By optimizing your company profits successfully,   

• You could become the industry leader & feel in complete control of your business while you can sleep well without stress.
• Your company could run itself, freeing you to spend more time with your family, while it continues to turn profit month after month.
• You could pay off your debt while also saving you HOURS of work each day so that you could work on revenue generating activities.
• Your stock price kept increasing & other companies calling you to ask you how you increased your profits so quickly.
• You could attract high caliber employees because you are the leader in the industry.
• You were able to go home early and spend time with your family because you have begun paying off all the debt.
• You could make enough money so that you could give your employees raises and bonuses.

Why Rantai Breakthrough Consulting?

Rantai Breakthrough Consulting has lots of experiences in helping many CEOs and Business Owners to massively increase company profits.

Our CEOs and founder of Rantai Breakthrough Consulting is a veteran CFO with 20 years of experience helping companies turnaround in many different industries.

Results previously seen like include turnaround companies by increasing profits by USD30million in 1 year and increase profits by 3.000% in a few years.

How does Rantai Breakthrough Consulting do it?

Our approach is we look and analyze the company as a whole not just piece meal. If we want to achieve positive results at the end, then we need to work and fix from the front end of the company.

We implement the HRS system, founded by Ronawati Wongso, CEO and founder of Rantai Breakthrough Consulting.

With HRS system, we take helicopter view of the company to find the root cause problems and provide the right solution to optimize the company profits.

We go deep to find the root cause problems and give long term solution, not just surface level solutions. You can reap the benefit years to come and the profits increase massively as quickly as 6-12 months period.

PROFIT OPTIMIZATION FAQ

What is the definition of profit optimization?

Profit optimization is finding ways to increase your profit with the available resources under the given constraints and to make the best use of it. 

To make it easier to understand:

Production machine in the factory is running at 5,000 units per month, assuming we have the demand for the product and the machine is running at full capacity, how are we going to optimize the machine so that it can run at 6,000 units per month.  The plant manager might lubricate the machine better, schedule maintenance at more regular time, change the part more regularly, reduce the down time etc.

WHAT is the purpose of profit optimization?

I would say no body rejects more money and more profits.  But WHY do you need to optimize your company profits?  Imagine all the benefits with more profits the company can generates.

Reason #1: Put MORE MONEY in shareholders’ pocket
Reason #2: HIGHER BONUS and pay for CEO and employees
Reason #3: INCREASE Company VALUE
Reason #4: GROW The Business
Reason #5: REDUCE the company DEBT FASTER
Reason #6: HIGHER Return on Investment (ROI)

How do you optimize profits?

There are 3 steps to massively increase your company profits, which I call HRS Systems
1. Helicopter View (H)
2. Determine Root Cause Problems (R)
3. Solution – Optimize your company profits (S)

As each company situation is different, we need to understand the business holistically and take helicopter view.  After we understand the company’s operation, we determine the Root Cause Problem, this phase is important as determining the RIGHT root cause problems will enable us to provide the RIGHT Solution to Optimize your company profits.

Where can you achieve profit optimization from?

·      better efficiency
·       better internal control
·       more orderly business process.