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by onoj 3948 days ago
One issue not being discussed is the revolving cost of having products out in the market and the cost of the next production run.

if your orders double from 20K units to 40K, your costs will roughly double, usually meaning that any profit made on the 20K is re-invested to make the 40K - usually plus additional capital.

So long as your production quantities double, you will not actually "have" any money (unless your FOB cost is north of four times sell price). Many companies cannot "realise" profit until orders stabilise.