The phrase “It paid for itself” is a desirable phrase I often hear business people use. Of course, it is desirable for a marketing campaign, new machine, or trade show attendance to cover its own costs. The problem is that many entrepreneurs, don’t really understand what it means for something to pay for itself.
There are two ways something can pay for itself. One is via savings generated, like when you buy solar roof panels for your home and save $100 per month in electricity over the next 30 years. The second concept is when an expense is believed to be covered by immediate or ongoing sales. The second concept is what our company does and it does well. We hand-pick clients we think we can take to another level, we charge fair fixed price for our services and set them on the path of constant growth.
In a profitable enterprise, expenses are paid with gross margin dollars, not sales dollars.