TSIG.com TIGI (formerly TSIG) Message Board

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Microcap & Penny Stocks : TSIG.com TIGI (formerly TSIG)

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To: Zeev Hed who wrote (33343)	8/8/1999 2:13:00 PM
From: Suzanne Newsome	Read Replies (1) of 44908

Zeev, I'm not certain I can add anything to Bob's comments but I'll try. Let's pretend that I am a basketball supplier, and you own a chain of sporting goods stores. I have a warehouse full of basketballs, which are unique in that they are guaranteed to go in the basket, and you are unable to find a comparable product. You and I agree to sell one basketball for $10 each, and we split the proceeds $5/$5. Would it be fair at this point in the example to say that revenue is $10 and profit is $5 if we assumed there were no additional costs? Thus my overhead is 50%. But I don't have to buy land, build a store, hire employees, and acquire other inventory. That is what giving up $5 of the sales price purchases for me. My TSIG revenue projections worked with the $5 as "revenue" which is a little misleading. If you want to assume 30% "working capital" is necessary (which I still don't believe is true for an Internet storefront), then use the gross sales price of $10 and consider TSIG receives some value for the $5 of revenue it gives up. Regards, Suzanne

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