Imagine you’re in The Matrix.

You’re wearing a black coat.

You have a slick hairstyle and set of cool shades to go along with it.

And you’re asked to choose the blue pill or the red pill.

The blue pill guarantees to give your Ecommerce business $200,000 total revenue every year.

The red pill ensures that your business rakes in $100,000 in yearly net profit.

Which pill do you take?

If you take the blue pill ($200,000 total revenue), but you have no idea about your gross profit margin or the overhead expenses of your business, there’s a possibility that your business won’t be sustainable over the long run.

Sure, $200,000 in gross revenue sounds like a dream come true. But if your cost of goods sold and operating expenses are $210,000 per year, you’re in the red.

But if you take the red pill ($100,000 net profit) and your business raked in $50,000 net profit last year, you just doubled your net profit!

You can either reinvest your profit into your business or use a specific portion of it to use for yourself.

Either way, profitability can dictate how significant the contribution of your business is in your growth as an entrepreneur.

How can you guide your business to actually be profitable? These four cornerstone metrics are what we’re going to discuss in today’s episode.

Edit: 03:52 mark: $5 not $50