The power of positive profit

ffirs.qxd 11/22/06 1:16 PM Page v The POWER of POSITIVE PROFIT How You Can Improve ANY Bottom Line in Sales, Marketing, and Management with MoneyMath© Graham Foster John Wiley & Sons, Inc ffirs.qxd 11/22/06 1:16 PM Page ii ffirs.qxd 11/22/06 1:16 PM Page i Praise for The Power of Positive Profit “This book is a major contribution to business understanding and conduct; the MoneyMath charts alone are worth the cover price!” —Walter J Reinhart, PhD, Professor of Finance and Academic Director, Master of Science in Finance, Loyola College “Brilliant and dynamic—nobody else knows business numbers like this!” —Naomi Rhode, Co-Founder and Director, Smarthealth Inc.; President, International Federation of Speaking Professionals, Phoenix, Arizona “We need more of your books for all our dealers!” —Les de Celis, CEO, Tyres4U, Sydney, Australia “The book is awesome You must join our board of directors!” —Jim Marsh, CEO, Burns & Ferrall Hospitality Equipment, Auckland, New Zealand ffirs.qxd 11/22/06 1:16 PM Page ii ffirs.qxd 11/22/06 1:16 PM Page iii The POWER of POSITIVE PROFIT ffirs.qxd 11/22/06 1:16 PM Page iv ffirs.qxd 11/22/06 1:16 PM Page v The POWER of POSITIVE PROFIT How You Can Improve ANY Bottom Line in Sales, Marketing, and Management with MoneyMath© Graham Foster John Wiley & Sons, Inc ffirs.qxd 11/22/06 1:16 PM Page vi Copyright © 2007 by Graham Foster All rights reserved Published by John Wiley & Sons, Inc., Hoboken, New Jersey Published simultaneously in Canada All MoneyMath Charts Copyright © 2004–2007 by Graham Foster, Pacific Seminars International Inc All rights reserved No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording, scanning, or otherwise, except as permitted under Section 107 or 108 of the 1976 United States Copyright Act, without either the prior written permission of the Publisher, or authorization through payment of the appropriate per-copy fee to the Copyright Clearance Center, Inc., 222 Rosewood Drive, Danvers, MA 01923, (970) 750-8400, fax (970) 646-8600, or on the web at www.copyright.com Requests to the Publisher for permission should be addressed to the Permissions Department, John Wiley & Sons, Inc., 111 River Street, Hoboken, NJ 07030, (201) 748-6011, fax (201) 748-6008, or online at http://www.wiley.com/go/permissions Limit of Liability/Disclaimer of Warranty: While the publisher and author have used their best efforts in preparing this book, they make no representations or warranties with respect to the accuracy or completeness of the contents of this book and specifically disclaim any implied warranties of merchantability or fitness for a particular purpose No warranty may be created or extended by sales representatives or written sales materials The advice and strategies contained herein may not be suitable for your situation You should consult with a professional where appropriate Neither the publisher nor author shall be liable for any loss of profit or any other commercial damages, including but not limited to special, incidental, consequential, or other damages For general information on our other products and services or for technical support, please contact our Customer Care Department within the United States at (800) 762-2974, outside the United States at (317) 572-3993 or fax (317) 572-4002 Designations used by companies to distinguish their products are often claimed by trademarks In all instances where the author or publisher is aware of a claim, the product names appear in Initial Capital letters Readers, however, should contact the appropriate companies for more complete information regarding trademarks and registration Wiley also publishes its books in a variety of electronic formats Some content that appears in print may not be available in electronic books For more information about Wiley products, visit our web site at www.wiley.com Library of Congress Cataloging-in-Publication Data: Foster, Graham The power of positive profit : how you can improve any bottom line in sales, marketing, and management / Graham Foster p cm Includes bibliographical references ISBN-13: 978-0-470-05234-1 (cloth) ISBN-10: 0-470-05234-1 (cloth) Corporate profits Pricing Sales management Cost control I Title HD4028.P7F67 2007 658.15'5—dc22 2006011037 Printed in the United States of America 10 ffirs.qxd 11/22/06 1:16 PM Page vii This book is dedicated with my deepest gratitude to my dear wife Suzi for encouraging me to write this and stick at it She has endured the tension of creative effort pouring from my soul ffirs.qxd 11/22/06 1:16 PM Page viii ccc_foster_ack_271-276.qxd 10/25/06 3:40 PM Page 271 Acknowledgments A mong the many friends and acquaintances who stimulated me to write this book are, in no particular order: • Anonymous persons—the donor and his/her family who donated the human heart valve to me in 1993 and made this book possible • Ted Shreve, my late father-in-law, who served on the USS Haverfield in World War II and founded Trautman & Shreve Inc., Denver, Colorado; he died October 11, 2005 • Caroline Shreve, my mother-in-law, who graduated from the University of Colorado with a degree in chemistry • Warren Foster, my late brother, who was a founding director of Red Hot Canary Moulding Company; he passed away on January 26, 2005 • Naomi Rhode of Phoenix, Arizona, my friend from 1995, mentor and co-founder of Smarthealth Inc., and past president of the National Speakers Association and International Federation of Speaking Professionals • Kerry Catell, ASEAN chairman and retired director of Foseco International, and without doubt a true Level leader • Walter Reinhart PhD, professor of finance and academic director of the masters of science in finance program at Loyola College, Baltimore, Maryland, who decided MoneyMath is unique 271 ccc_foster_ack_271-276.qxd 272 10/25/06 3:40 PM Page 272 ACKNOWLEDGMENTS • John Sommer, my longtime friend and management consultant in Sydney, Australia; adviser to the Australian Institute of Management • Harold E Cartwright, my first employer, boss, and mentor, who demonstrated product costing and integrity combined • Gordon Stenning, my favorite medical company entrepreneur in Australia • Adrian Diamond, the most survivable manager I have seen, coowner of Fire Services Australia and chairman of the board of The Lakes Golf Club in Sydney • Barry Markoff and Peter Rosetti of ICMI Australia—they run the best nationwide speakers bureau down under • Jeff Richards, CPA and accounting guru in Los Angeles, California • Geoff Sargent, the nicest Kiwi profit builder I have known • Timothy Martin-Wright, my favorite Englishman, who in 1982 took on a project for me and has been a great friend in Liverpool, England, ever since • Les de Celis, a dedicated CEO in Sydney who truly puts all his people first in the automotive business and is another Level leader • Leanne Christie, principal of Ovations, the best speakers bureau in Sydney, Australia • Dottie Walters of Glendora, California, the legendary author of Speak and Grow Rich, whose strategies helped open the door for me in the United States despite 9/11 • Nancy and Bill Lauterbach of Five Star Speakers in Kansas City, Kansas, and past president of the International Association of Speakers Bureaus who exposed MoneyMath to their members in Washington, D.C., in 2004 • Steve Gardner, president of Five Star Speakers Bureau in Kansas City, Kansas, who placed confidence in the message ccc_foster_ack_271-276.qxd 10/25/06 3:40 PM Page 273 Acknowledgments 273 • Dr Francisco Pena, my family doctor in Scottsdale, Arizona, who loves medicine more than money • Dr Paul Mercer of Brisbane, Queensland—my family doctor, who helped save my life in 1993 • Dr Malcolm Davison, the eminent Brisbane cardiologist who keeps my heart ticking despite everything else failing! • Dr Mark O’Brien, the international cardiac valve surgeon (now retired) at Prince of Wales Hospital in Queensland, who extended my life in 1993 • Michael Howes, CEO of Southwest Mechanical Services in Phoenix, Arizona, who cares more about customers than money • Gopal Padki, a totally amazing Indian CEO who speaks eight languages fluently and runs a very profitable business in Nanjing, China • Jeff Weekes, a fantastic South African CEO and director of Foseco who always makes double digit profits, and now leads the U.S operations • Adrian Dart, my consulting colleague from Johannesburg, who shares leadership strategies to people who want more productive work lives • Dick Smith, adventurer and businessman, the first person to fly a helicopter solo around the world, and my first consulting customer in 1972 • Gerry Harvey, the true retail genius of Southeast Asia, Australia, and New Zealand, who taught me entrepreneurialism • Jim Marsh, CEO of Burns Ferrall, Auckland, New Zealand, who applied MoneyMath and “11/10–24/7 Service” and rescued two companies • Jim Rhode, Arizona Entrepreneur of the Year 1999, co-founder of Smarthealth Inc in Phoenix, Arizona ccc_foster_ack_271-276.qxd 274 10/25/06 3:40 PM Page 274 ACKNOWLEDGMENTS • Duane Ward, president, and Brian Lord, vice president of Premiere Speakers Bureau in Nashville, Tennessee—they just love only quality in their business • Perry Scarfe, general manager of Tyres4U in New Zealand, who runs the best auto operation in New Zealand • Martin Roller, CEO of BMW Brisbane and former marketing director of BMW Australia • Kevin Steele, general manager of Schumacher European Mercedes in Scottsdale, Arizona, who became number one by always putting the customer first • Carl Sewell, principal of Sewell Motor Companies in Dallas, Texas, who kindly let me see inside his world’s-best automotive operations • Andrew Young, CEO of Kleenmaid Australasia, who chairs a superior appliance marketing organization down under • Ian Percy of Ian Percy Corp., North Scottsdale, Arizona, who runs an awesome group (www.profitabletransformations.com) • John Nevin, past CEO of World Book Encyclopedia, who first encouraged me to speak professionally • Jillian Moran, principal of Captive Audience Speakers Bureau, Auckland, New Zealand, who has the best bureau in the land of the long white cloud • Gale Ellsworth, CEO of Trailways Inc in Fairfax, Virginia, who truly understands the importance of profits for entrepreneurs • Victoria Whitney of Whitney Bureau in Sydney, Australia; she knows the true value of relationships • Mark French, chairman and CEO of Leading Authorities, Washington, D.C.—an executive who saw MoneyMath, applied it in his business, and listed the author He runs the best bureau on the East Coast ccc_foster_ack_271-276.qxd 10/25/06 3:40 PM Page 275 Acknowledgments 275 • Frank Scammarcia, CEO of Spectrum Fire, a true believer in the balanced company concept using MoneyMath • Andrea Gold of Gold Stars speakers bureau, Tucson, Arizona, a believer in the power of MoneyMath • Zig Ziglar of Carrollton, Dallas, Texas, the motivational speaker who welcomed me to America at the National Speakers Association in 1997 and said, “Keep your accent.” (What accent?) ccc_foster_ack_271-276.qxd 10/25/06 3:40 PM Page 276 ccc_foster_bib_277-278.qxd 10/25/06 3:40 PM Page 277 Bibliography and Recommended Reading Albrecht, Karl At America’s Service New York: Warner Books, 1995 Albrecht, Karl, and Lawrence Bradford The Service Advantage New York: Irwin Professional Publishers, 1989 Carlzon, Jan Moments of Truth New York: HarperCollins, 1989 Collins, Jim Good to Great New York: HarperCollins, 2001 Doyle, Peter, and Phil Stern Marketing Management and Strategy Englewood Cliffs, NJ: Prentice Hall, 2006 Foster, Graham Where the Rubber Meets the Road—Service! Sevierville, TN: Insight Publishers, 2006 Gates, Bill Business at the Speed of Thought New York: Warner Books, 2000 Gerstner, Lou Who Says Elephants Can’t Dance? New York: HarperCollins, 2003 Gross, Daniel Forbes—Greatest Business Stories of All Time New York: John Wiley & Sons, 1997 Hill, Napoleon Think and Grow Rich New York: Ballantine, 1987 The Holy Bible, English Standard Version (Wheaton, IL: Crossway Books, 2001) and New King James Version (Nashville, TN: Thomas Nelson, 1990) Koch, Richard The 80/20 Principle New York: Doubleday, 1998 Kotler, Philip, and Kevin Lane Keller Marketing Management Englewood Cliffs, NJ: Prentice Hall, 2005 Label, Wayne Accounting for Non-Accountants Sourcebooks, Inc., 2006 Liker, Jeffrey The Toyota Way New York: McGraw-Hill, 2004 277 ccc_foster_bib_277-278.qxd 278 10/25/06 3:40 PM Page 278 BIBLIOGRAPHY AND RECOMMENDED READING Maltz, Maxwell Psycho-Cybernetics New York: Simon & Schuster, 1989 Peale, Norman Vincent The Power of Positive Thinking New York: Random House, 1956 Sewell, Carl, and Paul Brown Customers for Life New York: Doubleday, 2002 Spector, Robert, and Patrick McCarthy The Nordstrom Way New York: John Wiley & Sons, 1996 Semler, Ricardo Maverick: The Success Story behind the World’s Most Unusual Workplace New York: Warner Books, 1995 Walters, Dottie, and Lillie Walters Speak and Grow Rich Englewood Cliffs, NJ: Prentice Hall, 1997 Winkler, John Pricing for Results Bicester, England: Facts on File Publications, 1984 Zemke, Ron, and Kristin Anderson Knock Your Socks Off Service New York: American Management Association, 1993 ccc_foster_ind_279-283.qxd 10/25/06 3:41 PM Page 279 Index Accountants, responsibility and, 182 A-class customers, 58–59, 74, 76, 249–251 Adamson, James, Advanced Micro Devices, 130 Advertising: effectiveness of, 112 on television, 36–39, 54, 120 Airline industry, 7–12, 49, 183, 185 Air New Zealand, 9–10 American Airlines, American Institute of Certified Public Accountants, 182 America West, Anderson, Richard, Ansett Airlines, 185 ANZ Bank, 99–100 Arthur Andersen, 182 Asset stripping, 176–177 Automobile industry, 12–16, 118, 185–188 Awesome percent approach to volume, cost, and price, 247–248 B-class customers, 59, 249–251 Bell, Charlie, Benefit: defined, 80 perceived value and, 79–90 Bethune, Gordon, Boards of directors, responsibility and, 185 Breakeven points, margin and, 27–28 Capitalism, education about, 35–36, 215–216 Carlzon, Jan, 11 Carnegie, Andrew, 209–211, 216 Cash flow, 169–179 importance of, 169–173 statements of, 170–171, 173–178 C-class customers, 59, 74, 75, 99, 249–251 Celis, Les de, 165 Chambers, John, 212 Chenault, Kenneth, 212 Coca-Cola, 81, 84–86, 255 Collins, Jim, 217 Competition, based on price cutting, 48–50, 151 See also Price wars Complaints, tracking customers’, 112, 149 Continental Airlines, 8, Continuous differentiation of products, 86–89 Corporations: bankruptcies and, 2–6 list of top profit earners, 193–194 profits failure and, 181–190 seven habits of highly effective, 206–208 Cost-based pricing systems, 147–150 Cost cutting, price and volume and, 45–52 Cox, Jim, 200 Currency fluctuation, price increases and, 114 279 ccc_foster_ind_279-283.qxd 280 10/25/06 3:41 PM Page 280 INDEX Customers: classes of, 58–59, 74, 75, 99, 249–251 differential pricing and, 71, 91–92, 151–152 educating about price increases, 114 having empathy for, 100 keeping, as prime objective, 211 perceptions about prices, 152–153 protecting during price wars, 145 signs of weakness in business of, 108–109 tracking price complaints from, 112, 149 Customer service: keeping and using log book of, 101–102 perceived value and, 257–258 pricing controls and, 96 Customers for Life (Sewell), 13 DaimlerChrysler, 12, 14–15 Dangerous markets, price wars and, 127–130 Delivery charges, 101 Delivery systems, evaluating, 112–113 Differential pricing, 71, 91–92, 151–152 Discounts, see also Prices in-kind equivalents of, 51, 98–99 sales organization and, 53–64, 73–76 sales volume increase needed to make up for, 55–57, 233–234 television advertising and, 38–39 Dixon, Geoff, 10 Dominated markets, price wars and, 121–123 Earnings before interest and taxes (EBIT), see Net profit Ebbers, Bernie, 184, 212 Egg-shaped markets: market-based pricing system and, 154–156 price wars and, 136–140 Eisner, Michael, 212 Empathy, for customer, 100 Employees, see Staff Enron, Ethics: executive pay and, 211–213 Judeo-Christian values in business, 216–218 pricing and, 163–164, 213–214 Executives, see Management External auditors, responsibility and, 182 Features/benefits of product or service: defined, 80 perceived value and, 79–90 Financial management questionnaire, 263–265 Financing, see Investing and financing activities Fisher & Paykel, 205 Five percent approach to volume, cost, and price, 247–248 Fixed costs: adjusting in hard times, 161–165 margin and, 21–28 net profit increase and, 45–52, 227–233 price wars and, 131–132, 238–245 sales volume and price cuts, 55–57, 233–234 Ford Motor Company, 12, 13–14 Foseco, 101–102 Foster’s Brewing Company, 203–204 Fragmented/splintered markets, price wars and, 123–127 Free enterprise, 36 Frequent flyer miles, 12 Gasoline industry, 119, 124–125 General Electric, 198, 199 General Motors, 12, 13–14, 185–188 Global Crossing, 184 ccc_foster_ind_279-283.qxd 10/25/06 3:41 PM Page 281 Index Golden percent approach to volume, cost, and price, 62–63, 245–246 Golub, Harvey, 212 Good to Great (Collins), 217 Hard times: balanced approach to, 165–166, 238–245 cost cutting approaches in, 159–165 HIH Insurance, 16–17, 184 Hill, Napoleon, 216 Hubbert, Jürgen, 15 Iacocca, Lee, 132 Inflation, price increases and, 114 Insurance business, 16–17 Intel, 130 Interest rates, 20, 114 Investing and financing activities, cash flow and, 169, 171–178 JetBlue, Johnson & Johnson, 196–197 Judeo-Christian values, 216–218 Kelleher, Herbert D., 11, 198 Kmart, Low-end market: market-based pricing system and, 155–156 price wars and, 136, 137–139, 141 Management: corporate failures and, 2–3, 5–7 financial management questionnaire, 263–265 linking compensation to performance, 185, 189, 211–213 responsibility to control discounting, 53–64, 73–76, 97 responsibility for profit failure, 181–182 281 Marconi telecommunications group, 184–185 Margin, 19–29, 221–222 attitude of schools toward capitalism and, 35–36 incentive plans based on, 54 lack of math knowledge and, 33–35 market-based pricing system and, 148–149 markup distinguished from, 31–33, 40–43, 222–227 perceived value and, 82, 88 price calculation software and, 39–40 price increases and, 67–68, 234–237 television advertising and, 36–39 Market-based pricing system, 112, 147–158 cost-based system contrasted to, 147–150 customer perceptions and, 152–153 in egg-shaped markets, 154–156 keeping pricing information private, 151–152 moral aspect of, 153–154 price competitiveness questions, 151 price leadership suggestions, 156–157 Market domination, 114 Marketing strategies, pricing and, 110–111 Market segments, price wars and, 136–141 Market share, 142–144 Market types, price wars and: dangerous markets, 127–130 dominated markets, 121–123 fragmented/splintered markets, 123–127 Markups, distinguished from margin, 31–33, 40–43, 222–227 Math skills, general lack of, 33–35 McDonald’s Inc., 6–7, 26–27, 137–138, 141, 156 Mercedes-Benz, 14–16 Mergers, price wars and, 126–127, 261 ccc_foster_ind_279-283.qxd 10/25/06 3:41 PM 282 Page 282 INDEX Microsoft, 87, 122–123, 145, 195–196 Middle market: market-based pricing system and, 156 price wars and, 136, 139–140 Model of cost, margins and, 19–29 Moments of Truth (Carlzon), 11 Monopoly, 114, 214 Monsanto, 142–144 Murphy’s Law on Profit, 68, 259–260 Neeleman, David, Net profit (NP), 20, 21–22 hard times and, 161–166 sales volume and price cuts, 55–57 three ways to improve, compared, 45–52, 159–161, 227–238 Nokia, 200–201, 202 Northwest Airlines, 7–8, 11–12 Nufarm, 142–144 “101 Price Management Questions,” 51, 266–270 One percent approach to volume, cost, and price, 62–63, 245–246 Pareto Principle (80-20 Rule), 99, 127 Parker, James F., 11 Payment terms, as discounts, 51 Perceived value, see Value Pfizer, 140 Pharmaceutical industry, 140 Platinum percent approach to sales, volume, and pricing, 246–247 Price committee, recommended, 51 “Price pointing,” 113, 152 Prices, see also Discounts; Margin; Market-based pricing system control of, 91–102 effects of increasing, 65–70, 234–238 effects of padding and then discounting, 57–58 guidelines and strategies for establishing, 109–111 limiting staff with authority to influence, 107 mathematics of cost cutting and volume, 45–52, 233–234 monetary value of features and benefits and, 81 supply and demand and, 105–106, 109–110 tips for increasing, 70–73, 107–108, 111–115 use of software to calculate margin and markup, 39–40 Price wars, 117–121 cost cutting during, 131–132, 238–245 market position and, 135–140 market types and, 121–130 recovery from, 140–146 Private companies, 214 Product line: continuous differentiation of, 86–89 protecting during price wars, 145–146 Profit, 222 See also Net profit list of top corporate earners, 193–194 social damage of failure to make, 181–190 Profit and loss (P&L) statement, 21 Profit Selling Pyramid, 262 Public companies, 214 Qantas, 10 Questionnaire, about financial management, 263–265 Rebates, taxes and, 258–259 Restocking fees, 100–101 Retailers: cost vs price and, 46, 231–232 model of cost and, 23–24 sales increase effect and, 252–253 ccc_foster_ind_279-283.qxd 10/25/06 3:41 PM Page 283 Index Returns, fees for, 100–101 Revson, Charles, 135 Royal Bank of Scotland Group, 201–203 Sainsbury’s, 138 Sales increase effect—factory, retail, service industries, 62–63, 251–254 Sales organization, management’s responsibility to control discounting by, 53–64, 73–76, 97 Sarbanes-Oxley, 182–183 Scandinavian Airlines, 11 Schrempp, Jürgen, 15 Scott, H Lee, Jr., Service, see also Customer service defined, 25 margin increase and, 87–89 Service industry: model of costs and, 24–25, 232–233 sales increase effect and, 253–254 Seven habits of highly effective corporations, 206–208 Sewell, Carl, 12–13 Shipping costs, discounts and, 51 Skimming, 156 Social damage, of poor management and profit failure, 181–190 Software, use of margin and markup to set prices, 39–40 Southwest Airlines, 10–11, 198, 200 S-P-A-C-E-D grid, 80–89, 254–255 Sports industry, 119–120 Staff: educating about profit goals, 153–154, 214 layoffs and social damage, 183–186 reducing, as inefficient response to hard times, 131–132, 163–165 Statements of cash flow, 170–171, 173–178 283 Stockholders, responsibility for profit failure, 183, 185 Supply and demand environment, 105–106, 109–110 Taxes, 20, 258–259 Telephone, controlling of prices and, 92, 96–98 Television advertising, 36–39, 54, 120 Ten percent discount, as most popular, 55, 94 Tesco’s, 138 Think and Grow Rich (Hill), 216 Top-end market: market-based pricing system and, 156 price wars and, 136–137 Toyota, 188 Two percent approach to sales, volume, and pricing, 246–247 United Airlines, 8–9, 183 US Airways, Value: margin and perceived, 82, 88, 255–259 as sales tool, 79–90 Value-adding service, 25–27, 150 Variable costs: adjusting in hard times, 161–165 margin and, 22–28 net profit increase and, 45–52, 227–233 price wars and, 131–132, 238–245 sales volume and price cuts, 55–57, 233–234 Wal-Mart, 6, 138–139, 213 Watts, Phillip, 212–213 WorldCom, 5, 183–184 ccc_foster_ata_284.qxd 10/25/06 3:41 PM Page 284 About the Author raham Foster is an author, business adviser, and keynote presenter He speaks at conferences around the world and runs in-house seminars on the subject of profitability, customer service, and selling skills for profit All those operational business elements that sustain profitability—margin, customer service, price salesmanship, market pricing, differentiated pricing, segmented marketing, relationship selling strategies, price elasticity, handling price wars, and more—are covered in his seminars As this book goes to press, Mr Foster has made over 3,580 presentations in 44 countries He is available to speak at your conference or to consult with your senior management He is a CSP (Certified Speaking Professional) accredited with the National Speakers Association and is a current company director The profit improvement resources, both written and digital, are also available from Mr Foster’s two offices or from his Internet web site listed below G Pacific Seminars International (Phoenix, Arizona) www.pacificseminars.com E-mail: GrahamHFoster@msn.com GrahamHFoster@hotmail.com Voice: 602-684-5644 (24/7 global) Asia-Pacific (Brisbane, Australia) Voice: 0409-361526 (24/7) E-mail: gfoster@pacific.net.au Skype ID: GrahamHFoster 284 ... math of strategic decisions into the forefront • The power of positive profit recognizes the objective of the firm and allows for all stakeholders to be treated fairly • The power of positive profit. .. stream of positive profits Moreover, the math is basic math—one does not have to be a statistical wizard to understand the concepts presented in MoneyMath: • The power of positive profit puts the. .. her career and the profits of the firm Don’t be put off by the fact that the concepts presented here are founded on math The objective of all firms is to maximize the wealth of the owners, which