Sales are Vanity, Profit is Sanity
According to market analysts Plimsoll Publishing, the company’s Tyre Manufacturers & Distributors report published in June, “prompted a backlash in the…industry.” In response to this, Plimsoll has produced an updated study to incorporate the very latest figures and bring the picture right up to date.
The feedback Plimsoll received from the original publication was that in general, companies were not experiencing too much difficulty in retaining sales. This is borne out in the updated analysis that puts current market growth at a respectable 5 per cent. Note however this is down from the previous year’s 7 per cent. 156 of the 200 companies analysed are said to be holding or increasing sales on last year.
However this apparently hides some worrying trends:
31 per cent of companies are currently selling at a loss; 48 per cent of the 200 companies are making less profit than last year; and the report rates 34 companies as a high risk of failure.
Senior Analyst, David Pattison, commented: “The reality is sales teams are very rarely privy to the full picture. All too often, they are unaware of the costs of overheads, the levels of debt and how their sales add up in profitability. The latest figures do seem to suggest that the focus has switched from profit to sales, as companies grab business almost at any cost! The old adage has never been more apt, ‘sales for vanity – profit is sanity.”