If a business has 2 locations, one being profitable and the other operating at a loss; how long should you wait until you shut down the non-profitable location?
If a business has 2 locations...
Brayden Murphy
Benjamin Smith
21
Austin Jenkins
It may look that way, but us Amerifats aren't actually formal owners of the EU.
Aaron Gonzalez
Open a third that may help boost the losing site
Jack King
Stay in business as long as you are meeting your variable costs.
Colton Campbell
i asked the same question and a top McKinsey consultant told me that 49 days and 19 hours is the industry standard
Carter Gonzalez
Kekd
Leo Reed
Depends on circumstances. If the first location is in the oldest location and in the green and the second location is new and in the red that is a normal circumstance. You would need to know about normal industry customer acquisition and if the second location was on track or not, and why.
Mason Campbell
Do you expect it to still turn a profit? When? How large a profit, increasing at what rate?
If it isn't expected to turn a profit fast enough the money is better invested elsewhere.
Simple as that.
Bentley Martinez
In the real world, the non-profitable location is the source of valuable tax write offs.
In crypto...it's just failure, but since it doesn't really cost anything to maintain, it can linger forever without really dying or needing 'shutting down".
Easton Price
when the risk adjusted future cash flow for the unprofitable site turns negative.
Robert Adams
most retarded answer in the thread desu
Hunter Jenkins
That is the textbook economic answer. Your fixed cost are there no matter what. If you get more money for operating than not operating then you operate.
Hunter Long
If it's unprofitable and you have no expectation of it becoming profitable in the near future you should shut it down immediately.
Alexander Powell
did u even read what OP typed?
use your brainlet IQ
Bentley Sullivan
Lol.
Jeremiah Collins
bout three fiddy
Austin Cruz
are taxes considered fixed costs as well?
Zachary Ward
It might still be worth it in the short run if you have a factory or something. If it was 100% unprofitable then you should just shut down immediately.
smart boi
Anthony Green
Depends. Things which can be determined well ahead of time, like property taxes, licenses, etc are fixed. Things which scale with the business and can theoretically be zero are variable.
Ryan Ortiz
The thing with crypto is that if you zoom the chart out you might actually be ahead.