More Revenue, Less Cash, and More Work
“What if more revenue led to less cash and more work? Would you still chase it?”
This isn’t a hypothetical question. It’s a trap many business owners find themselves in. They work harder, bring in more dollars, but end up with less cash, less time, and more stress.
So why does this happen, and what can you do about it?
The Illusion of Growth
Growth feels good. More revenue can seem like a sign of success. But often, chasing revenue at all costs leads to dangerous practices:
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Inappropriate pricing: Offering discounts or underpricing to close deals.
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Bad terms: Acting like a bank, offering lenient payment schedules that drain cash flow.
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Scope creep: Taking on work outside your core competencies leads to inefficiencies and chaos.
The result? You might work twice as hard for half the return while your cash flow bleeds out.
What Does Your Business Really Need?
You’ve heard it before: “Work on your business, not in it.” This advice is more relevant than ever. The role of a Chief Profitability Officer (CPO) is to look at your business holistically. Instead of focusing solely on revenue, a CPO ensures that your business is structured to:
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Work less: Reduce the unnecessary workload by focusing on what truly matters.
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Generate more cash: Optimize profitability so that you, the owner, take home more.
The 16 Levers of Profitability
Every business has a unique mix of factors—16, to be exact—that influence profitability. These levers include pricing, terms, operations, and even customer selection. Pulling the right ones creates a balance that maximizes profit without overwhelming you with more work.
The mistake? Believing more revenue is always the solution. Many times, it’s the problem.
The 70% Problem
Jonathan Byrnes, an MIT professor, reveals a shocking statistic in Islands of Profit in a Sea of Red Ink:
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Around 30% of what companies do generates over 100% of profits.
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The next 30-40% is break-even.
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The final 30-40% actively loses money.
That means for many businesses, 60-70% of activities don’t drive profits—they’re a waste of time and resources.
The Path Forward
It’s time to stop chasing dollars blindly. Ask yourself:
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Are you pricing your services appropriately?
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Are you managing cash flow effectively?
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Are you focusing on your core competencies?
More importantly: Are you building a business that works for you?
Because here’s the truth: Growth without profitability is just vanity. And no customer will ever thank you for burning yourself out to serve them.
Build a Business That Works
The Chief Profitability Officer’s job is simple: ensure you’re not just working harder but working smarter. By optimizing your business for cash flow and owner satisfaction, you’ll create a company that gives you more time, more profit, and more freedom.
This isn’t about working less for the sake of it—it’s about making the work you do count.
Want to know which levers your business should pull to maximize profitability and reduce chaos? Let’s talk.
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