Cash cow
Meaning
A product, business, or asset that generates a consistent and substantial profit with minimal ongoing investment or effort.
Origin
The vivid imagery of a "cash cow" directly evokes a dairy cow, which, once mature, requires minimal upkeep while continuously producing valuable milk—a steady, low-effort source of income for a farmer. This potent metaphor transitioned into the business lexicon during the mid-20th century, gaining significant traction with the rise of portfolio management strategies. Notably, the Boston Consulting Group's growth-share matrix, developed around the 1970s, explicitly labeled products or business units that hold a large market share in a mature, low-growth industry as "cash cows," highlighting their role in generating more cash than they consume, effectively "milking" profits for the larger enterprise.
Examples
- Their older software suite may not be innovative, but it remains a crucial cash cow, funding all their research and development.
- For many small towns, tourism serves as the primary cash cow, bringing in significant revenue during peak season.