Healthy Margins

Henry Ford was famous for his relentless pursuit of cost-cutting measures.

Costco founder Jim Sinegal has spent decades trimming expenses.

Soichiro Honda built his first motorcycle using a surplus engine and a bicycle frame, which set the stage for the development of affordable, fuel-efficient vehicles that would become the company's trademark.

Growth isn’t fancy marketing campaigns or a fleet of salesmen. But all the companies without venture capital know that something else comes first.

Leftover money to invest in growth.

At their best, Chipotle restaurants run a 25% net margin. $100 of burrito sales means $25 for the bottom line.

Chipotle has higher profit margins than most fast food restaurants, so they can make a lot of money from their $2.5 million in average sales per store.

A new Chipotle costs $800,000 to $1 million to open.

So they can pay back their investment in less than 3 years, without any debt.

That’s a recipe for growth.

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