{"id":195477,"date":"2025-02-06T00:00:04","date_gmt":"2025-02-06T08:00:04","guid":{"rendered":"https:\/\/www.nationalfunding.com\/blog\/?p=195477"},"modified":"2025-02-06T14:12:30","modified_gmt":"2025-02-06T22:12:30","slug":"business-bottom-line","status":"publish","type":"post","link":"https:\/\/www.nationalfunding.com\/blog\/business-bottom-line\/","title":{"rendered":"Why Top Line and Bottom Line Matter and How to Grow Them"},"content":{"rendered":"<p><span data-contrast=\"auto\">The top line and bottom line both come from your income statement where the first line (the top line) is your total revenue, and the last line (the bottom line) represents your business\u2019s profit<\/span><i><span data-contrast=\"auto\">.<\/span><\/i><span data-contrast=\"auto\"> Both are important measures of financial health, as your top line is the money you can use to cover expenses, pay people, etc., and the bottom line represents how much money your business keeps after paying all of your expenses and taxes.\u00a0<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/p>\n<p><span data-contrast=\"auto\">Since they both come from the income statement, the top and bottom lines are related by this formula:<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/p>\n<ul>\n<li data-leveltext=\"\u25cf\" data-font=\"\" data-listid=\"4\" data-list-defn-props=\"{&quot;335552541&quot;:1,&quot;335559685&quot;:720,&quot;335559991&quot;:360,&quot;469769242&quot;:[8226],&quot;469777803&quot;:&quot;left&quot;,&quot;469777804&quot;:&quot;\u25cf&quot;,&quot;469777815&quot;:&quot;multilevel&quot;}\" aria-setsize=\"-1\" data-aria-posinset=\"1\" data-aria-level=\"1\"><span data-contrast=\"auto\">Bottom Line = Top Line &#8211; Expenses<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/li>\n<\/ul>\n<p><span data-contrast=\"auto\">In an ideal situation, your top and bottom lines will grow together, where the top line grows faster than expenses. But sometimes one will grow while the other declines. For example, a recession can hit your top line sales, but you can still grow the bottom line by cutting expenses.\u00a0<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/p>\n<p><span data-contrast=\"auto\">Other times, you can grow the top line by investing with a <\/span><a href=\"https:\/\/www.nationalfunding.com\/small-business-loans\/\"><span data-contrast=\"none\">small business loan<\/span><\/a><span data-contrast=\"auto\">, even though it will decrease near-term bottom line due to higher expenses now that you make monthly payments to the lender. In the long run, the investment will grow both top and bottom line together.<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/p>\n<h2 aria-level=\"2\"><span data-contrast=\"auto\">Top Line Revenue vs. Bottom Line\u00a0<\/span><span data-ccp-props=\"{&quot;134245418&quot;:true,&quot;134245529&quot;:true,&quot;335559738&quot;:360,&quot;335559739&quot;:120}\">\u00a0<\/span><\/h2>\n<p><span data-contrast=\"auto\">Top line is your total sales (also called revenue) and bottom line is the total profit (also known as net income or net earnings) you get after subtracting all costs from the top line. When your company experiences top-line growth<\/span><i><span data-contrast=\"auto\">,<\/span><\/i><span data-contrast=\"auto\"> it means there\u2019s an increase in sales. More revenue allows for increased investment in advertising, new product development, and hiring.<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/p>\n<h2 aria-level=\"2\"><span data-contrast=\"auto\">What is the Bottom Line in Business?<\/span><span data-ccp-props=\"{&quot;134245418&quot;:true,&quot;134245529&quot;:true,&quot;335559738&quot;:360,&quot;335559739&quot;:120}\">\u00a0<\/span><\/h2>\n<p><span data-contrast=\"auto\">The bottom line is a business\u2019s profit, the net income after deducting all expenses from the top line revenue. Bottom line expenses can include:\u00a0<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/p>\n<ul>\n<li data-leveltext=\"\u25cf\" data-font=\"\" data-listid=\"5\" data-list-defn-props=\"{&quot;335552541&quot;:1,&quot;335559685&quot;:720,&quot;335559991&quot;:360,&quot;469769242&quot;:[8226],&quot;469777803&quot;:&quot;left&quot;,&quot;469777804&quot;:&quot;\u25cf&quot;,&quot;469777815&quot;:&quot;multilevel&quot;}\" aria-setsize=\"-1\" data-aria-posinset=\"1\" data-aria-level=\"1\"><a href=\"https:\/\/www.nationalfunding.com\/blog\/what-is-cost-of-goods-sold\/\"><span data-contrast=\"none\">Cost of goods sold<\/span><\/a><span data-contrast=\"auto\">, including direct labor and materials.<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/li>\n<\/ul>\n<ul>\n<li data-leveltext=\"\u25cf\" data-font=\"\" data-listid=\"5\" data-list-defn-props=\"{&quot;335552541&quot;:1,&quot;335559685&quot;:720,&quot;335559991&quot;:360,&quot;469769242&quot;:[8226],&quot;469777803&quot;:&quot;left&quot;,&quot;469777804&quot;:&quot;\u25cf&quot;,&quot;469777815&quot;:&quot;multilevel&quot;}\" aria-setsize=\"-1\" data-aria-posinset=\"2\" data-aria-level=\"1\"><span data-contrast=\"auto\">Fixed overhead and administrative expenses.<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/li>\n<\/ul>\n<ul>\n<li data-leveltext=\"\u25cf\" data-font=\"\" data-listid=\"5\" data-list-defn-props=\"{&quot;335552541&quot;:1,&quot;335559685&quot;:720,&quot;335559991&quot;:360,&quot;469769242&quot;:[8226],&quot;469777803&quot;:&quot;left&quot;,&quot;469777804&quot;:&quot;\u25cf&quot;,&quot;469777815&quot;:&quot;multilevel&quot;}\" aria-setsize=\"-1\" data-aria-posinset=\"3\" data-aria-level=\"1\"><span data-contrast=\"auto\">Interest charges on loans and other debts.<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/li>\n<\/ul>\n<ul>\n<li data-leveltext=\"\u25cf\" data-font=\"\" data-listid=\"5\" data-list-defn-props=\"{&quot;335552541&quot;:1,&quot;335559685&quot;:720,&quot;335559991&quot;:360,&quot;469769242&quot;:[8226],&quot;469777803&quot;:&quot;left&quot;,&quot;469777804&quot;:&quot;\u25cf&quot;,&quot;469777815&quot;:&quot;multilevel&quot;}\" aria-setsize=\"-1\" data-aria-posinset=\"4\" data-aria-level=\"1\"><span data-contrast=\"auto\">Depreciation and amortization charges.<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/li>\n<\/ul>\n<ul>\n<li data-leveltext=\"\u25cf\" data-font=\"\" data-listid=\"5\" data-list-defn-props=\"{&quot;335552541&quot;:1,&quot;335559685&quot;:720,&quot;335559991&quot;:360,&quot;469769242&quot;:[8226],&quot;469777803&quot;:&quot;left&quot;,&quot;469777804&quot;:&quot;\u25cf&quot;,&quot;469777815&quot;:&quot;multilevel&quot;}\" aria-setsize=\"-1\" data-aria-posinset=\"5\" data-aria-level=\"1\"><span data-contrast=\"auto\">Federal, state, and local income taxes.<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/li>\n<\/ul>\n<h3 aria-level=\"3\"><span data-contrast=\"none\">The Triple Bottom Line<\/span><span data-ccp-props=\"{&quot;134245418&quot;:true,&quot;134245529&quot;:true,&quot;335559738&quot;:320,&quot;335559739&quot;:80}\">\u00a0<\/span><\/h3>\n<p><span data-contrast=\"auto\">Some businesses add what is known as a triple bottom line, which means they measure their performance by both financial health and the impact on society, including the people as well as the environment. The triple bottom line is sometimes referred to as \u201cthe triple Ps\u201d: profit, people, and planet.<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/p>\n<p><span data-contrast=\"auto\">Companies that consider the social good aspect of their business are known to resonate more with some consumers. By emphasizing social responsibility and environmental sustainability, companies can build stronger connections with their audience.<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/p>\n<h2 aria-level=\"2\"><span data-contrast=\"auto\">Why Top Line and Bottom Line Matter to Investors and Lenders<\/span><span data-ccp-props=\"{&quot;134245418&quot;:true,&quot;134245529&quot;:true,&quot;335559738&quot;:360,&quot;335559739&quot;:120}\">\u00a0<\/span><\/h2>\n<p><span data-contrast=\"auto\">Top and bottom lines both matter to investors and creditors, but investors will look for growth since they get paid out of the bottom line, and lenders want stability to ensure you will make regular loan payments.\u00a0<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/p>\n<p><span data-contrast=\"auto\">Investors put money into your company in return for equity, meaning they get to share whatever the company earns. That\u2019s why they\u2019ll focus first on the bottom line and your ability to grow it, but they don\u2019t count out the top line.\u00a0\u00a0<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/p>\n<p><span data-contrast=\"auto\">Depending on how your top line is growing, investors will want to see different actions to make sure the bottom line grows and they get paid:\u00a0<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/p>\n<table data-tablestyle=\"Custom\" data-tablelook=\"0\" aria-rowcount=\"3\">\n<tbody>\n<tr aria-rowindex=\"1\">\n<td data-celllook=\"69905\"><b><span data-contrast=\"auto\">Situation<\/span><\/b><span data-ccp-props=\"{&quot;134245417&quot;:false,&quot;201341983&quot;:0,&quot;335559740&quot;:240}\">\u00a0<\/span><\/td>\n<td data-celllook=\"69905\"><b><span data-contrast=\"auto\">What investors want to see<\/span><\/b><span data-ccp-props=\"{&quot;134245417&quot;:false,&quot;201341983&quot;:0,&quot;335559740&quot;:240}\">\u00a0<\/span><\/td>\n<\/tr>\n<tr aria-rowindex=\"2\">\n<td data-celllook=\"69905\"><span data-contrast=\"auto\">Steady top line growth<\/span><span data-ccp-props=\"{&quot;134245417&quot;:false,&quot;201341983&quot;:0,&quot;335559740&quot;:240}\">\u00a0<\/span><\/td>\n<td data-celllook=\"69905\"><span data-contrast=\"auto\">Control expenses<\/span><span data-ccp-props=\"{&quot;134245417&quot;:false,&quot;201341983&quot;:0,&quot;335559740&quot;:240}\">\u00a0<\/span><\/td>\n<\/tr>\n<tr aria-rowindex=\"3\">\n<td data-celllook=\"69905\"><span data-contrast=\"auto\">Stagnant or declining top line<\/span><span data-ccp-props=\"{&quot;134245417&quot;:false,&quot;201341983&quot;:0,&quot;335559740&quot;:240}\">\u00a0<\/span><\/td>\n<td data-celllook=\"69905\"><span data-contrast=\"auto\">Cut costs or open new sales channels<\/span><span data-ccp-props=\"{&quot;134245417&quot;:false,&quot;201341983&quot;:0,&quot;335559740&quot;:240}\">\u00a0<\/span><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<p>&nbsp;<\/p>\n<p><span data-contrast=\"auto\">If the top line is growing steadily, investors want to see you control expenses and not waste money that could instead drop to the bottom line. If your top line is stagnant or declining, investors will want you to find new sources of sales or to cut costs so that the bottom line doesn\u2019t suffer.<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/p>\n<p><span data-contrast=\"auto\">Meanwhile, lenders will look for stability more than growth potential because a stable top line and bottom line means you\u2019re more likely to repay the loan in full, which is how the lender makes their money. The lender\u2019s payments come as an expense (before the bottom line), so they\u2019ll be determining their willingness to invest based on your ability to pay each month.\u00a0\u00a0<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/p>\n<p><b><i><span data-contrast=\"auto\">Accounting tip<\/span><\/i><\/b><i><span data-contrast=\"auto\">: Interest on loans is an expense that you subtract from the top line to get to the bottom line.\u00a0<\/span><\/i><span data-ccp-props=\"{}\">\u00a0<\/span><\/p>\n<h2 aria-level=\"2\"><span data-contrast=\"auto\">Ways to Grow the Top and Bottom Lines<\/span><span data-ccp-props=\"{&quot;134245418&quot;:true,&quot;134245529&quot;:true,&quot;335559738&quot;:360,&quot;335559739&quot;:120}\">\u00a0<\/span><\/h2>\n<p><span data-contrast=\"auto\">Although growing the top line makes it easier to grow your bottom line since you don\u2019t need to cut as many costs, you can still grow the bottom line even when your top line declines. There are different strategies you can take depending on the current and foreseeable economic conditions, like recessions and strong economies.<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/p>\n<h3 aria-level=\"3\"><span data-contrast=\"none\">Grow Top and Bottom Lines During Recessions<\/span><span data-ccp-props=\"{&quot;134245418&quot;:true,&quot;134245529&quot;:true,&quot;335559738&quot;:320,&quot;335559739&quot;:80}\">\u00a0<\/span><\/h3>\n<p><span data-contrast=\"auto\">It may seem counterintuitive to grow your top and bottom lines in economic downturns like recessions, but these strategies can help you do it:<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/p>\n<ul>\n<li data-leveltext=\"\u25cf\" data-font=\"\" data-listid=\"2\" data-list-defn-props=\"{&quot;335552541&quot;:1,&quot;335559685&quot;:720,&quot;335559991&quot;:360,&quot;469769242&quot;:[8226],&quot;469777803&quot;:&quot;left&quot;,&quot;469777804&quot;:&quot;\u25cf&quot;,&quot;469777815&quot;:&quot;multilevel&quot;}\" aria-setsize=\"-1\" data-aria-posinset=\"1\" data-aria-level=\"1\"><span data-contrast=\"auto\">Launch in new markets and product uses.<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/li>\n<\/ul>\n<ul>\n<li data-leveltext=\"\u25cf\" data-font=\"\" data-listid=\"2\" data-list-defn-props=\"{&quot;335552541&quot;:1,&quot;335559685&quot;:720,&quot;335559991&quot;:360,&quot;469769242&quot;:[8226],&quot;469777803&quot;:&quot;left&quot;,&quot;469777804&quot;:&quot;\u25cf&quot;,&quot;469777815&quot;:&quot;multilevel&quot;}\" aria-setsize=\"-1\" data-aria-posinset=\"2\" data-aria-level=\"1\"><span data-contrast=\"auto\">Use sales tactics to increase price paid.<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/li>\n<\/ul>\n<ul>\n<li data-leveltext=\"\u25cf\" data-font=\"\" data-listid=\"2\" data-list-defn-props=\"{&quot;335552541&quot;:1,&quot;335559685&quot;:720,&quot;335559991&quot;:360,&quot;469769242&quot;:[8226],&quot;469777803&quot;:&quot;left&quot;,&quot;469777804&quot;:&quot;\u25cf&quot;,&quot;469777815&quot;:&quot;multilevel&quot;}\" aria-setsize=\"-1\" data-aria-posinset=\"3\" data-aria-level=\"1\"><span data-contrast=\"auto\">Bundle products vs slashing prices.<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/li>\n<\/ul>\n<ul>\n<li data-leveltext=\"\u25cf\" data-font=\"\" data-listid=\"2\" data-list-defn-props=\"{&quot;335552541&quot;:1,&quot;335559685&quot;:720,&quot;335559991&quot;:360,&quot;469769242&quot;:[8226],&quot;469777803&quot;:&quot;left&quot;,&quot;469777804&quot;:&quot;\u25cf&quot;,&quot;469777815&quot;:&quot;multilevel&quot;}\" aria-setsize=\"-1\" data-aria-posinset=\"4\" data-aria-level=\"1\"><span data-contrast=\"auto\">Invest in marketing.<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/li>\n<\/ul>\n<ul>\n<li data-leveltext=\"\u25cf\" data-font=\"\" data-listid=\"2\" data-list-defn-props=\"{&quot;335552541&quot;:1,&quot;335559685&quot;:720,&quot;335559991&quot;:360,&quot;469769242&quot;:[8226],&quot;469777803&quot;:&quot;left&quot;,&quot;469777804&quot;:&quot;\u25cf&quot;,&quot;469777815&quot;:&quot;multilevel&quot;}\" aria-setsize=\"-1\" data-aria-posinset=\"5\" data-aria-level=\"1\"><span data-contrast=\"auto\">Improve your efficiency or change your business model.<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/li>\n<\/ul>\n<h3 aria-level=\"4\"><span data-contrast=\"none\">Launch in new markets and product uses<\/span><span data-ccp-props=\"{&quot;134245418&quot;:true,&quot;134245529&quot;:true,&quot;335559738&quot;:280,&quot;335559739&quot;:80}\">\u00a0<\/span><\/h3>\n<p><span data-contrast=\"auto\">Entering new markets can boost your top line when the new market revenue more than compensates for the decline in your current market. This can be a new geographic market where you reach new customers. And it\u2019s even better if they\u2019re a similar demographic to your current audience, as you\u2019ll already have the experience in advertising to them and meeting their needs.\u00a0<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/p>\n<p><span data-contrast=\"auto\">You can also lock in lower lease payments during a recession, boosting your bottom line through lower fixed costs as the economy recovers. Since your top line represents your total company revenue, you can break it down with this formula:<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/p>\n<ul>\n<li data-leveltext=\"\u25cf\" data-font=\"\" data-listid=\"1\" data-list-defn-props=\"{&quot;335552541&quot;:1,&quot;335559685&quot;:720,&quot;335559991&quot;:360,&quot;469769242&quot;:[8226],&quot;469777803&quot;:&quot;left&quot;,&quot;469777804&quot;:&quot;\u25cf&quot;,&quot;469777815&quot;:&quot;multilevel&quot;}\" aria-setsize=\"-1\" data-aria-posinset=\"1\" data-aria-level=\"1\"><span data-contrast=\"auto\">Top Line = Number of Items Sold * Price Per Item<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/li>\n<\/ul>\n<p><span data-contrast=\"auto\">New geographic markets aren\u2019t the only way to grow your top and bottom lines in recessions.\u00a0 There may be creative ways consumers can use your products too.<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/p>\n<p><span data-contrast=\"auto\">Finding a new use for a product is a fantastic way to increase the number of items sold in recessions. Joseph McVicker took his company\u2018s product, originally intended as a wallpaper cleaner, and turned it into <\/span><a href=\"https:\/\/www.housebeautiful.com\/lifestyle\/kids-pets\/a20074233\/play-doh-originally-purpose-wallpaper-cleaner\/\"><span data-contrast=\"none\">one of the most popular toys of all time<\/span><\/a><span data-contrast=\"auto\">. McVicker simultaneously boosted his bottom line profitability thanks to accurate COGS since he was able to cut the detergent costs out of the product.<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/p>\n<p><span data-contrast=\"auto\">Another <\/span><a href=\"https:\/\/en.wikipedia.org\/wiki\/Feed_sack_dress\"><span data-contrast=\"none\">great story<\/span><\/a><span data-contrast=\"auto\"> was in 1925, where the Textile Bag Manufacturers Association increased sales of cotton sacks for flour, sugar, and seeds by promoting their reuse as a fashion item. They encouraged people to sew them into clothing, even distributing booklets like fashion magazines with tips on how to turn flour sacks into wardrobe items. It became so popular that the commodity producers printed fashion designs on their sacks to attract shoppers from other brands.<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/p>\n<h3 aria-level=\"4\"><span data-contrast=\"none\">Sales tactics to increase the price paid<\/span><span data-ccp-props=\"{&quot;134245418&quot;:true,&quot;134245529&quot;:true,&quot;335559738&quot;:280,&quot;335559739&quot;:80}\">\u00a0<\/span><\/h3>\n<p><span data-contrast=\"auto\">Instead of trying to increase prices during a recession, use sales tactics to upsell and cross sell customers into higher-priced items. Streaming services are a great example where they charge a bit more for you to watch the same programs without ads. Compared to the overall cost, the additional amount is tiny, but you feel like you\u2019re getting a great value while the streaming service is growing their top line.<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/p>\n<h3 aria-level=\"4\"><span data-contrast=\"none\">Bundle products vs. slashing prices<\/span><span data-ccp-props=\"{&quot;134245418&quot;:true,&quot;134245529&quot;:true,&quot;335559738&quot;:280,&quot;335559739&quot;:80}\">\u00a0<\/span><\/h3>\n<p><span data-contrast=\"auto\">Let competitors resort to slashing prices in an attempt to entice customers and erode their top line. This makes it harder for them to raise prices when the economy recovers. While they cut prices, you can try bundling as a way to discount multiple product purchases. When done well, it can grow your top line with more items sold and possibly bring you more customers.<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/p>\n<p><span data-contrast=\"auto\">This is especially powerful when the bundled products are complementary, like laundry soap and fabric softener. Laundry soap is a necessity, while softener is a luxury and an upsell. By giving a discount for buying both together, instead of individual discounts, your customers get a larger total savings or at least a larger perceived value by saving on both depending on the deal.<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/p>\n<p><span data-contrast=\"auto\">If the bundle picks up, it can grow your overall top line by gaining customers from other stores that discount just one or the other. Because it costs roughly the same to service a customer buying one product versus two, it also prevents your bottom line from suffering if they had skipped the softener.<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/p>\n<h3 aria-level=\"4\"><span data-contrast=\"none\">Invest in marketing<\/span><span data-ccp-props=\"{&quot;134245418&quot;:true,&quot;134245529&quot;:true,&quot;335559738&quot;:280,&quot;335559739&quot;:80}\">\u00a0<\/span><\/h3>\n<p><a href=\"https:\/\/marketing.pamplin.vt.edu\/content\/dam\/marketing_pamplin_vt_edu\/pdfs\/How%20to%20Market%20in%20a%20Downturn.pdf\"><span data-contrast=\"none\">Companies that invest in marketing during recessions may come out ahead<\/span><\/a><span data-contrast=\"auto\"> compared to companies that scale back, and they tend to grow both their top and bottom lines over the long term. This is especially true if they build their brands while competitors get forgotten.<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/p>\n<p><span data-contrast=\"auto\">This is a great time to negotiate lower rates from ad sales reps who are hungry for business, as other businesses stop marketing altogether. This boosts your bottom line with the reduced expenses and keeps you top of mind for consumers who can help you grow your top line as they try out your brand.<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/p>\n<h3 aria-level=\"4\"><span data-contrast=\"none\">Improve your efficiency or change your business model<\/span><span data-ccp-props=\"{&quot;134245418&quot;:true,&quot;134245529&quot;:true,&quot;335559738&quot;:280,&quot;335559739&quot;:80}\">\u00a0<\/span><\/h3>\n<p><span data-contrast=\"auto\">Recessions are also a great time to improve your efficiency with capital improvements, like investing in new machines with an <\/span><a href=\"https:\/\/www.nationalfunding.com\/equipment-leasing\/\"><span data-contrast=\"none\">equipment financing loan<\/span><\/a><span data-contrast=\"auto\">. Interest rates <\/span><a href=\"https:\/\/fred.stlouisfed.org\/series\/DPRIME\"><span data-contrast=\"none\">usually fall during recessions<\/span><\/a><span data-contrast=\"auto\">, so you can boost your long-term bottom line by locking in a low rate that keeps your expenses low as the economy recovers.\u00a0<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/p>\n<p><b><i><span data-contrast=\"auto\">Bonus tip<\/span><\/i><\/b><i><span data-contrast=\"auto\">: Use a <\/span><\/i><a href=\"https:\/\/www.nationalfunding.com\/blog\/a-guide-to-the-section-179-deduction-and-its-changes\/\"><i><span data-contrast=\"none\">Section 179 deduction<\/span><\/i><\/a><i><span data-contrast=\"auto\"> or bonus depreciation when you buy new machines. This will decrease your bottom line in year 1 because of the higher depreciation expense, but you\u2019ll pay less tax and boost your bottom line in future years. Plus, depreciation is a non-cash expense, so you can reinvest the cash into your business.<\/span><\/i><span data-ccp-props=\"{}\">\u00a0<\/span><\/p>\n<p><span data-contrast=\"auto\">New equipment will also help you save on maintenance costs and make your business more efficient, so you don\u2019t need to spend as much on labor or utilities. You can even save on rent costs if the new machines are smaller and you can reduce your leased square footage. Altogether, the savings can offset the interest expense from a loan, allowing you to grow your bottom line even if your top line declines temporarily.<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/p>\n<p><span data-contrast=\"auto\">Changing your business model is another idea. An example could be a restaurant leaving an expensive retail lease and using a <\/span><a href=\"https:\/\/www.nationalfunding.com\/industries\/loans\/food-truck-business\/\"><span data-contrast=\"none\">food truck loan<\/span><\/a><span data-contrast=\"auto\"> to start anew. This lets them take their food to customers rather than relying on customers coming to them. That\u2019s one of the reasons why food trucks boomed following the great financial crisis. <\/span><a href=\"https:\/\/www.reuters.com\/article\/lifestyle\/recession-drives-us-restaurateurs-diners-to-trucks-idUSTRE58600H\/\"><span data-contrast=\"none\">Diners want deals but also want a fun experience<\/span><\/a><span data-contrast=\"auto\">.\u00a0<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/p>\n<p><span data-contrast=\"auto\">Money saved on labor and utilities with a food truck offsets interest expenses from the loan to grow the bottom line. Plus, these businesses can grow their top line by serving customers in new areas, like taking the truck to office parks for lunch hours and soccer fields for dinner time. They can even serve the late-night crowds coming out of entertainment venues. And this is just one example.<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/p>\n<h2 aria-level=\"3\"><span data-contrast=\"none\">Grow Your Top and Bottom Lines in a Good Economy<\/span><span data-ccp-props=\"{&quot;134245418&quot;:true,&quot;134245529&quot;:true,&quot;335559738&quot;:320,&quot;335559739&quot;:80}\">\u00a0<\/span><\/h2>\n<p><span data-contrast=\"auto\">Each of the ideas above can also grow your top and bottom lines in a good economy. For example, increasing prices gives a direct lift to your top line. Just be careful and make sure you test any increase to see if it causes a drop in the number of items sold, which lowers overall revenue.\u00a0<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/p>\n<p><span data-contrast=\"auto\">Strong economic conditions can open you up to even more opportunities for growing your business. Here are two strategies to boost your top and bottom lines in a good economy:<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/p>\n<ul>\n<li data-leveltext=\"\u25cf\" data-font=\"\" data-listid=\"3\" data-list-defn-props=\"{&quot;335552541&quot;:1,&quot;335559685&quot;:720,&quot;335559991&quot;:360,&quot;469769242&quot;:[8226],&quot;469777803&quot;:&quot;left&quot;,&quot;469777804&quot;:&quot;\u25cf&quot;,&quot;469777815&quot;:&quot;multilevel&quot;}\" aria-setsize=\"-1\" data-aria-posinset=\"1\" data-aria-level=\"1\"><span data-contrast=\"auto\">Increase consumption.<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/li>\n<li data-leveltext=\"\u25cf\" data-font=\"\" data-listid=\"3\" data-list-defn-props=\"{&quot;335552541&quot;:1,&quot;335559685&quot;:720,&quot;335559991&quot;:360,&quot;469769242&quot;:[8226],&quot;469777803&quot;:&quot;left&quot;,&quot;469777804&quot;:&quot;\u25cf&quot;,&quot;469777815&quot;:&quot;multilevel&quot;}\" aria-setsize=\"-1\" data-aria-posinset=\"1\" data-aria-level=\"1\"><span data-contrast=\"auto\">Invest in new marketing capabilities.<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/li>\n<\/ul>\n<h3 aria-level=\"4\"><span data-contrast=\"none\">Increase consumption<\/span><span data-ccp-props=\"{&quot;134245418&quot;:true,&quot;134245529&quot;:true,&quot;335559738&quot;:280,&quot;335559739&quot;:80}\">\u00a0<\/span><\/h3>\n<p><span data-contrast=\"auto\">Increasing customer consumption grows the top line without raising prices by getting them to buy more per purchase or use more each time they use your product. Sometimes consumers use more product when they have more of it on hand.\u00a0<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/p>\n<p><span data-contrast=\"auto\">This is one of the reasons why paper product companies say that \u201cone roll is equal to multiple,\u201d and why they list specific numbers of sheets inside the box or container. People may use extra sheets of paper towels when there\u2019s more in the garage, but they\u2019ll likely use every last square inch of the last sheet when there are no more left.\u00a0<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/p>\n<p><span data-contrast=\"auto\">This means you could boost the top line with larger packages since consumers may be more likely to go through your product faster and more frequently. Then you can negotiate volume discounts with suppliers to boost your bottom line as well. You could even create new marketing slogans that encourage consumption. <\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/p>\n<p><span data-contrast=\"auto\">A similar idea is to invest in a new form or new packaging that causes people to use a little bit more each time. For example, a toothpaste manufacturer could hire a design firm to create the molds for a \u201cfresh new look\u201d with a slightly wider opening. Think about how you apply toothpaste: It\u2019s likely based on the length of your brush and not the total amount of paste.\u00a0<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/p>\n<p><span data-contrast=\"auto\">With the wider opening, customers now use more each time they brush and the new look attracts more customers, both of which can boost the top line. Plus, the wider opening could make it easier to fill tubes and help you save on manufacturing costs. Further, the new design could lower printing and packaging costs, giving a bump to the bottom line as well.<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/p>\n<p aria-level=\"4\"><span data-contrast=\"none\">Invest in new marketing capabilities<\/span><span data-ccp-props=\"{&quot;134245418&quot;:true,&quot;134245529&quot;:true,&quot;335559738&quot;:280,&quot;335559739&quot;:80}\">\u00a0<\/span><\/p>\n<p><span data-contrast=\"auto\">Investing in new marketing capabilities drives additional sales for your top line when times are good. It also helps you find more cost-effective marketing channels so you can keep your bottom line healthy in the next recession.\u00a0\u00a0<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/p>\n<p><span data-contrast=\"auto\">As technology continues to develop, learning new systems and techniques will boost the bottom line with cost savings from fewer people needed to manage your advertising.\u00a0<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/p>\n<p><span data-contrast=\"auto\">Both top line and bottom line indicate the financial health of your business and are related by the Bottom Line = Top Line &#8211; Expenses equation. With the right growth strategies, you\u2019ll keep both measures growing through any economy.<\/span><span data-ccp-props=\"{}\">\u00a0<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>The top line and bottom line in business are important figures on a company&#8217;s income statement. Find out which one&#8217;s more important for long-term growth.<\/p>\n","protected":false},"author":38,"featured_media":206094,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2],"tags":[72,118],"class_list":["post-195477","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-financial-health","tag-business-budget","tag-marketing-for-small-business"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v25.8 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Why Top Line &amp; Bottom Line Matter and How to Grow Them<\/title>\n<meta name=\"description\" content=\"Top line and bottom line measure a business\u2019s financial health and are important to lenders and investors. 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