In The MJ at the end of May, Barry Quirk wrote that, ‘any business needs its revenues to be greater than its costs over the longer term or else it will fail'. Furthermore, ‘in local government our problem is that...we are generally in a "downward flight path" of revenues. In short, we need continually to reduce our costs to keep ahead of this decline'.

In the commercial world the primary financial goal is profitability. For those in local government faced with increasing revenues through trading, sharing and partnering, the goal isn't always so simple. Are they looking for self-sufficiency where their ‘business' revenues will cover all expenses, or profitability, where ‘business' revenues exceed expenses? Are they seeking contribution, where ‘business' revenues will contribute to costs with the remainder being covered by other revenue sources? All of this only make sense where the true cost picture is known and can be applied to the revenues being earned.