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Actual cash beats notional profit, every time

  • By Alan Knott-Craig
  • March 14, 2020

You have a widget. It cost you R10 to make it. 

You want to sell it for R20.

Someone offers you R15. 

Your instinct is to say, “No way, it’s R20, take it or leave it.”

All fine and well.

You’ve preserved your notional profit of R10 instead of locked in cash profit of R5. 

But notional profits don’t pay the bills.

Only cash pays the bills. 

Sometimes you gotta take the R15. Or go out of business. 

Actual cash beats notional profit, every time

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