Cash Cow
Cash Cow is the term used for a particular business, product or asset that, once acquired and paid off, continues to generate high profit margins and a continual cash flow for the remainder of its lifespan.
Obviously any businesses’ aim would be to have as many cash cows as possible as they are able to maintain themselves and rarely require further investment.
The term cash cow is said to originate from the idea that after having paid for a dairy cow, it can be milked again and again with minimal input and investment on the part of the owner. It makes enough money from the sale of its milk to sustain itself and perhaps even to support other projects.
The cash cow, therefore, is usually a well-established product with a brand name that everyone knows. It is this familiarity with the product which encourages repeated buying with no need for extra investment in the product to increase sales.
For example, a magazine with a high subsciption rate could be seen as a cash cow because it pays for itself in the subscription fees and once the subscription is up, its readership will automatically renew their subscription. Hence, there is no need to advertise and promote the magazine for each new issue.
