Margins and pricing
The loss on a job order goes into the accounts in full in the year it becomes foreseeable
3 November 2026, 08:13
The French train maker has announced that its contracts for regional transport in Germany will end in the red and has revised its forecasts for the year. For anyone who works to order, the question is when that loss must be recorded: the accounting rule requires it to be recognised in full in the financial year in which it is seen, even if the work has only just begun.
A product warranty is a cost of the year in which the sale is made
28 October 2026, 07:57
An Italian yacht builder extends its standard warranty by one year to support orders and lists that choice among the causes of lower margins: repairs are paid for in later years, but in the accounts they belong to the year of the sale.
A manager's bonus should be tied to what the manager decides
25 October 2026, 08:57
At Lindt, managers' bonuses will reflect the targets missed in the countries where customers did not accept the higher chocolate prices. Variable pay works when the target measures the choices of the person who receives it and what the business earns from them.
When sales fall, reducible costs are found in the history of the accounts
23 October 2026, 09:38
Volvo Cars is responding to falling sales with a new round of cost cuts, keeping indirect spend separate from variable costs. In an SME, too, the items to bring down are identified by comparing them with past years: fixed items in euros, variable items by their share of turnover.
A loss-making branch is judged on the costs that disappear when it closes
17 October 2026, 09:33
To decide whether to keep a store, a department or a product line, the costs that disappear with the closure are separated from the shared overheads, which remain. A branch that shows a loss on its full account may be paying part of everyone's structure, and closing it worsens the result.
A fall in the price of a raw material reaches the margin late
11 October 2026, 09:46
On 9 October the United States Department of Agriculture raised its estimate of the American maize harvest, and on the Chicago exchange the price of maize for December delivery fell by about 4 per cent in a single day. If purchases become cheaper in Italy too, those who buy maize will see the saving in their accounts with a delay, because they must first use up the stock they have already bought.
Bialetti returns to profit: just over one cent for every euro of normalised EBITDA
10 October 2026, 18:19
Bialetti opens two shops in Turin and hires five people, after closing 2025 with €24 million of normalised EBITDA and about €0.3 million of profit: in between lie, among other things, depreciation, interest, taxes and non-recurring charges.
Dearer energy raises the break-even point: the increase is measured in turnover to be added, not in euros on the bill
9 October 2026, 09:40
In the Bank of Italy survey of firms with at least 50 employees, published on 8 October, more than four in five report higher energy costs because of the war in the Middle East, and about 45 per cent of those affected have taken no countermeasures. An energy price rise is measured in euros, the profit lost, and in turnover: the extra sales needed to pay for it by selling more, which is far more than the bill.
Carousel fraud in electronics: the VAT the missing trader never pays becomes the discount, and the European rule that allows it has been "transitional" since 1993
8 October 2026, 18:17
In the Hermes investigation, 93 Italian companies and invoices alleged to be false for over €450 million between 2022 and 2025: electronics cross EU borders free of VAT, the tax collected in Italy never reaches the State, and the rule that allows it has been written as provisional for thirty-three years.
In Italian cinema public aid is worth 37 per cent of production: a company's margin must also be read without the grants
6 October 2026, 09:42
The Ministry of Culture's report on the film law shows companies whose operating result is positive and turns negative once grants are removed. The same check applies to any business: the grant sits among revenues and lifts EBITDA, but it lasts only as long as the rule that provides it.
The euro hits its lowest since May 2025: currency risk weighs on the dollars paid out that sales do not bring back
5 October 2026, 09:42
Anyone buying in dollars pays more even if the supplier leaves its price list untouched; anyone selling across the Atlantic collects more. The number to know is not the value of the euro but the gap between the currency going out and the currency coming in, and in the accounts part of the price rise ends up among the financial charges.
In Japan small firms see their purchases go up more often than large ones, yet raise prices just as much: a price list is updated on the cost structure
1 October 2026, 09:27
The Bank of Japan's Tankan survey says large companies are at their most confident in eight years, and in a table further down it shows that small firms see their purchases go up more often but raise their prices no more than the large ones. A price that is not recalculated item by item stays put, and the margin pays the difference.
The diesel discount hasn't ended: now Eni pays for it instead of the State
28 September 2026, 21:03
The State is cutting the diesel discount that cost it about €12 million a day, and at the same moment Eni is capping prices at its filling stations. The bill moves from taxes to the oil companies' margins, and competitors have to follow suit with their own money.
Barilla builds a mill in Foggia and sells two: making in-house pays only above a threshold
27 September 2026, 10:13
Barilla is spending €100 million on a mill next to its pasta factory in Foggia, while selling two mills and continuing to buy their semolina. It is not a contradiction: making in-house what is otherwise bought turns a cost that follows sales into a cost that has to be paid regardless, and it pays only above a turnover threshold that should be calculated before signing.
Turnover grows by 3 per cent and profit falls: that is what happens when the margin loses two points
26 September 2026, 09:53
According to Unioncamere, more than one business in four expects turnover to grow by at least 3 per cent in 2026, and among the businesses worried about their energy bills 43.4 per cent expect lower margins. Taken together, the two forecasts can mean more work and less profit: a company's strength is measured by its distance from the break-even point, not by its turnover.
You can answer yes to all three of the Observatory's questions and still see EBITDA fall
24 September 2026, 08:41
UniCredit's survey of SMEs in southern Italy measures turnover, production and headcount, but not margin: EBITDA is the number that tells whether the business engine is working, and it can fall in the very year everything else rises.
Lucas invented the category in which his museum will be judged
21 September 2026, 18:07
The Lucas Museum of Narrative Art was born inside a category defined by its founder, and that makes any verdict impossible: the same thing happens in business every time a project is declared non-comparable.
Money already spent has no place in the decision. And yet it decides almost everything
21 September 2026, 12:53
Britain and France knew Concorde would never pay back what it cost, and carried on regardless. The same sentence can be heard on every factory floor, in front of the line that has been losing money for three years.
High energy costs are a fact. That they are your problem remains to be proven
21 September 2026, 12:38
Confartigianato puts a number on the table, and it is right. But before deciding that energy is your problem you need another number, and it is in your own financial statements: how much energy weighs on the value of production.
Diesel can't be cut. Its share of turnover can.
21 September 2026, 09:07
The diesel price surge hitting hauliers says something that applies to everyone: a cost built into the service can't be cut, it is squeezed on its share of turnover, by working on price, on the quotation and on the contract. Meanwhile the tax credit improves profit long before it improves cash.
Your top customer is worth 40% of turnover: the right question is not how much it buys
20 September 2026, 18:46
How to measure customer concentration by looking at margin rather than volume, and how to work out how many weeks of runway the cost structure leaves you if that customer stops ordering.
How to (really) reorganise a company: case history no. 5
Training
In many industrial companies, volume grows… but margins don’t. Why?
How to (really) reorganise a company: case history no. 1
Training
We are not talking about theory but about reality. About a real business, with real problems and a growth path built step by step, with method, vision and courage.
The purchasing department does not just place orders
Training
In truly well-organised companies, the Purchasing Manager is not simply someone who carries out tasks but a strategic role.
Manufacturing businesses and controlling
Training
Let’s get to the heart of the more technical side of controlling: that of mechanical engineering companies.
Without a budget, you are not running the business. You are reacting
Training
Once you understand how to build a price, where margin is generated and how to analyse it, you reach the highest level: deciding where you want to go.
Do you really want to understand where you make money? Then you need to change perspective
Training
Once you have started reading COGS and margins, the next level follows: understanding how income is generated.
You don't need cost accounting to understand where you are making money
Training
You need to start by asking yourself: “But what am I really making money on?” Many think that without an advanced cost accounting system it is impossible to answer, but that is not the case.
The problem isn’t the price. It’s how you build it
Training
Many companies are convinced they have a sales problem. “The market doesn't pay.” “Customers haggle over price.” “The competition is aggressive.”
Does the market decide the price? No. Your cost structure does
Training
Let’s continue our journey through informed business management.
Profitability by product line: what the financial statements don't tell you
Training
In previous posts we got to grips with the logic of the Break Even Point: now we’ll start to understand where the money is really made.
From calculation to control: the real value of the Break Even Point
Training
Every business owner knows the concept of “breaking even” but hardly anyone really uses it as a strategic compass.
How to truly understand the break-even point: the power of reclassifying the financial statements
Training
Of all the tools a business owner can use to understand whether the company is really making money or just spinning its wheels, reclassifying the financial statements is one of the most underrated.
The numbers that really matter: reading the financial statements to steer the business
Training
The balance sheet, the profit and loss account and the cash flow statement tell the story of the company: now it’s time to understand how to read them to make real decisions.