Reading between the (Business) lines


 

When it comes to focus, some managers chase top line growth, and some bottom line. “What’s the point in having a big top line, when bottom-line is zilch”, they say. “When you grow the top line, bottom line automatically grows”, adversaries say. While, the Top line responsibility wrest with sales team, the bottom line is largely a function of marketing and production (operations & support) teams. So how and where do we draw the line?


Bottomline parameters

(static case without any new product/market introduction)

Bottomline is a representation of

1. Bargaining power (external factor)

· Pricing at higher end of the market

· Differentiated Product/ service

· Low number of competitors or weak/no competition

· Lesser alternatives for the product/ services


2. Operational efficiency (Internal factor)

· Sourcing of materials

· Know-how or technology access /advantage

· Efficiency of production operations (improved methods/systems/ high productivity)

· Efficient supply chain management and logistics



Topline Parameters (static case without any new product/market introduction)

Topline is a representation of

3. Sales efficiency

· Strength of sales process

· Size of sales/service team (including franchisee and distributor level)

· Width and depth of Distribution to maximize reach to customer


4. Brand preference /salience

· Proven product performance

· Established customer base/ installations

· Clear price positioning


So, next time during the budgeting exercise you could use a model to classify competition and your positions to help in identifying areas to target for that ambitious topline or bottom line growth. You could bring in more fun by adding in numbers to rate it or even weight them to create an index of sorts.

· Rating of 1 to 5 with 5 being highest



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