You have recently joined a manufacturing company as CEO. The company makes two products, both of which are designed and built well. Yet each one is sold to a different base of consumer.

We'll call your first product Cash Flow. It has an existing customer base who buys at a gross profit level of approximately 40% and they pay you at time of delivery. No terms have ever been requested other than C.O.D. Your second product is Cash Cow. It's sold to a business segment that is highly competitive. As such, the average gross profit is 22% at best. That's 50% less gross profit than your other product; it also has specific cost of sale properties that add to its lack luster appeal. But wait, there's more. Customers who purchase this product require net 30 terms, essentially meaning that your company is financing your customers' purchases short term at 0.0% interest. These customers also require that you ship the product to them at no additional cost, so your company is absorbing the freight associated with every sale on the order at roughly 65% of the gross earned.

So here's the question: As incoming CEO, how much focus would you apply to growing the sales volume of Cash Cow compared to Cash Flow? While somewhat unconventional, this is an accurate comparison of your retail parts operations vs. your wholesale parts operations. Basic operational priorities need to be constantly checked against logic. To begin improving your approach to fixed operations, I encourage you to examine the expenditure of effort vs. reward in all areas of your business. For most Dealerships, this is a great place to start.