Saving Cash For Growth, Not Financial Survival

By Don Reisinger  |  Posted 05-09-2013

Saving Cash For Growth, Not Financial Survival

Revenue Is On the Rise for Most  According to the latest data, 63% of companies say they increased revenue in the last 12 months, indicating a stronger economic marketplace.

Saving Cash For Growth, Not Financial Survival

Saving Cash For Growth, Not Financial Survival

Things Are Getting Better  Although every company aims to generate higher revenue, only 32% increased their revenue between 2008 and 2010.

Saving Cash For Growth, Not Financial Survival

Saving Cash For Growth, Not Financial Survival

So, How Did It Happen  Surely, much of those revenue gains were due to smart investments, right? Think again: 76% of companies say that they reduced costs over the last two years—and revenue still increased.

Saving Cash For Growth, Not Financial Survival

Saving Cash For Growth, Not Financial Survival

More Cost-Reductions On the Way  Given the success of cost reduction, it's no surprise that 78% of companies are planning to further cut costs in the next two years as part of their revenue-generation model.

Saving Cash For Growth, Not Financial Survival

Saving Cash For Growth, Not Financial Survival

Rising Sales Will See Costs Decline Even More  Here's another surprise: 78% of companies with soaring revenue gains plan to cut costs, compared to 70% of firms that have flat or declining sales figures.

Saving Cash For Growth, Not Financial Survival

Saving Cash For Growth, Not Financial Survival

It's All About Profits  What’s companies’ top strategic goal over the next 24 months? According to 43% of respondents, it's all about profitability.

Saving Cash For Growth, Not Financial Survival

Saving Cash For Growth, Not Financial Survival

Sales Growth Is Another Biggie  If profits are important, it's no surprise that sales growth is another major concern for companies, with 36% saying that's their biggest priority over the next two years.

Saving Cash For Growth, Not Financial Survival

Saving Cash For Growth, Not Financial Survival

What Drives Cost Management?  According to the Deloitte survey, 65% of companies believe that by cutting costs, they'll be able to "gain a competitive advantage" in the marketplace.

Saving Cash For Growth, Not Financial Survival

Saving Cash For Growth, Not Financial Survival

Cost-Cutting Leads to Investment  It's not just about competition. More than half of businesses—54%—believe that if they cut costs, they'll be able to obtain the required investment they need for growth.

Saving Cash For Growth, Not Financial Survival

Saving Cash For Growth, Not Financial Survival

Unfortunately, Cost Reduction Doesn't Always Work  As important as cost reduction might be, there's one problem: 48% of companies failed to cut costs, despite a desire to do so.

Saving Cash For Growth, Not Financial Survival

Saving Cash For Growth, Not Financial Survival

Why Can't Costs Be Cut?  According to 74% of businesses, they weren't successful at cutting costs because of a "lack of understanding" in the organization about the value of reducing costs.

Saving Cash For Growth, Not Financial Survival