Tulupõhised

Tulupõhised is a term used in Estonian business and economic discourse to describe approaches, methods or decision-making processes that base planning and actions primarily on expected revenue or profit rather than on costs. The word is formed from tulud (revenue) and põhised (based). It is commonly used in Estonian-language discussions of pricing, budgeting and performance management, and is contrasted with kulupõhised, which prioritizes costs as the main driver.

In pricing, tulupõhised pricing aims to maximize expected revenue or profitability by considering demand, price elasticity and market conditions, rather than simply setting prices to cover costs. In budgeting and resource allocation, tulupõhised planning uses forecasted revenue as the main constraint and driver for allocating funds and setting targets. In performance management, incentives or compensation may be tied to revenue or gross profit, aligning employees with revenue growth.

Advantages include alignment with market potential, support for growth-oriented strategies, and a clearer link between activities and revenue outcomes. Limitations include reliance on accurate demand and price forecasts, potential neglect of cost control, and susceptibility to revenue volatility. It requires robust analytics, market intelligence and risk management to mitigate misestimations.

Examples: a company that allocates marketing and sales resources based on projected revenue contributions; a pricing team that uses revenue-based models to optimize pricing. Related concepts: cost-based pricing, revenue management, contribution margin, and profitability analysis.