True Profit!: No Company Ever Went Broke Turning a Profit

Preface
Contents
1 Profit: What is It?
	So What is Profit Anyway?
	Is Profit Actually a Cost?
	Clearing Up the Alphabet Soup of Profit
	Expressing Profit as Returns
	Nominal versus Real Profit
	Profit and Opportunity Costs
	Profit and Risk
	Profit Determination in Practice
	Profit and Value Creation
	Profit and Liquidity
	Cash Flow
	Free Cash Flow
	Profit is Profit
	Summary
	References
2 In Search of Profit
	Overestimated Profits
	Profits by Country
	Smaller Country, Higher Margin
	Profit Dynamics
	Sector Margins
	Returns in Retail and Wholesale Trade
	The Profits of the Giants
	Profit Dynamics of the Global 500
	Profit Stars
	Margin Stars
	Global Superstars
	The Troupe of Mediocrity
	The Money Losers
	A Look At Asia
	Hidden Champions
	Return on Capital
	Summary
	References
3 The Goal
	Theory versus Reality
	Goals in Practice
	Goal Conflicts
	Volume and Market Share Goals
	Digitalization
	Competitive Orientation
	Profit Goals
	Long-Term Profit Maximization
	Shareholder Value
	Goals and Incentives
	Summary
	References
4 The Ethics of Profit
	The Superiority of Capitalism
	Profit and Freedom
	Profit, Ethics, and Decency
	Corporate Social Responsibility
	The Role of the Internet
	Are Profits Morally Questionable?
	Profit and Intellectuals
	Taboos and Transparency
	Is Profit Maximization Necessary?
	Shareholder Value versus Stakeholder Value
	Profit in Good and Bad Times
	Profit, Purpose, and Motivation
	A Disappointing End
	Summary
	References
5 Diagnosis and Therapy
	Wrong Goals
	Profit Orientation by Country
	Profit Orientation by Industry
	Knowledge of Revenues and Profits
	Adjusting the Goals
	Reporting
	Communication
	Time Periods and Profit
	Chief Profit Officer
	Goal Conflicts
	Wrong Incentives
	Shares Instead of Options
	Wrong Industry
	Five Forces
	Overcapacity
	Lack of Focus
	Overemphasis on Long-Term Orientation
	Country-Specific Determinants of Profit
	Dominance of Mature Industries
	Weaknesses in Scaling Up
	Individual versus Team Responsibility
	The Power of Labor
	The Role of Banks
	Taxes
	Negative Connotation
	Summary
	References
6 Profit Driver: Price
	Special Features of Price as a Profit Driver
	Rapid Deployability and Response Time
	Attention Paid to Price
	The Complexity of Price Systems
	Price versus Volume
	Profit Elasticity of Price
	Profit-Maximizing Price
	Marxist Prices
	Price Differentiation and Profit
	Psychology of Price
	Premium Strategy
	Low-Price Strategy
	Internet, Price, and Profit
	New Price Metrics
	Price and Shareholder Value
	Pricing Process
	What Benefits Does Better Pricing Bring?
	Summary
	References
7 Profit Driver: Sales Volume
	Special Features of Volume as a Profit Driver
	Autonomous versus Price-Induced Volume Growth
	More Volume, Less Profit
	Less Volume, More Profit
	Profit Elasticity of Sales Volume
	The Profit-Maximizing Sales Volume
	Market Penetration
	More Effective Sales Activities
	Reducing Overcapacity
	Digitalization
	New Products
	Less Expensive Alternatives
	Internationalization
	Diversification
	Yield Management
	Service Expansion
	Unbundling of Services
	From Product Offering to Systems Offering
	Discounts in Kind
	Volume and Shareholder Value
	Summary
	References
8 Profit Driver: Cost
	Special Features of Costs as a Profit Driver
	Profit Elasticity of Costs
	Fixed versus Variable Costs
	Costs and Price Floors
	Costs and the Break-Even-Point
	Cost Structure
	Economies of Scale and the Experience Curve
	Zero Marginal Costs
	Cost Management
	Cost Culture
	Employee Involvement
	Management Commitment
	Effectiveness: Cost-Value Analysis
	Eradicate Ineffectiveness
	Efficiency and Productivity
	Suppliers
	Digitalization
	Avoiding Arrogance
	Costs and Crises
	Summary
	References
Epilogue