The Three Numbers I Ask Every CEO to Know Cold

April 23, 2026

I’ve asked thousands of CEOs the same three questions. Maybe one in ten can answer all three without checking a report. Those are the companies that win.

Number 1: Gross margin by product line

Not overall gross margin. By product line. If you have ten product lines, you should know the margin on each — and which direction they’re each trending. If you can’t, your pricing decisions are guesses.

Number 2: Customer concentration

What percentage of revenue and what percentage of profit comes from your top 10 customers? If either number is above 50%, you have a concentration risk that will kill your exit valuation. Most CEOs know the revenue number. Almost none know the profit number.

Number 3: Free cash flow, trailing 12 months

Not EBITDA. Not revenue. Free cash flow. This is the number PE firms buy on and banks lend on. If you can’t quote it to three decimal places on demand, you’re not running your company — your CFO is.

Why this matters

These three numbers tell you where to invest, who to fire, and what your company is worth. Every strategic decision routes through them. If they’re not in your head, they’re not driving your decisions.

Ready for a direct conversation about your business?

Bill Canady takes a limited number of strategy coaching calls each month with middle market CEOs, founders, and owners who want a direct read on where their company stands and what to do next. No pitch. No fluff. One honest conversation about growth, profitability, and exit readiness. Book your strategy coaching call at billcanady.com.

About the Author

Bill Canady

Bill Canady is a national best-selling author, Founder & CEO of The 80/20 Institute, and a global business leader known for transforming companies into high-performing, profitable enterprises. Over the course of his career, Bill has led multibillion-dollar organizations through their most critical challenges—navigating complex regulatory, investor, and media environments—while consistently delivering profitable growth.

Drawing on decades of executive experience, Bill created the Profitable Growth Operating System (PGOS), a proven framework designed to help leaders cut complexity, focus on the critical few, and accelerate growth. Through The 80/20 Institute, he and his team partner with CEOs, executives, and entrepreneurs worldwide to apply the 80/20 methodology in real-world settings, unlocking revenue growth, margin expansion, and shareholder value.

As both an operator and advisor, Bill’s mission is clear: to give leaders the tools, systems, and confidence they need to achieve sustainable, profitable growth — without sacrificing focus, culture, or execution.

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