Why Growth Without Margin Isn't Growth At All

So when it comes to business growth, There's a large misnomer just about the philosophy of what's happening while we're growing.

A lot of owners are not necessarily, when they find themselves in trouble, It's not because revenue is down in a lot of cases.

As a matter of fact, we see all the time, you probably hear in the news, large companies where they continue to grow, grow, grow, but they went bankrupt.

They went out of business or they had to file different chapters for protection and so on.

You're like, how? Stocks, this, how does it happen? Well, They're in trouble because revenue is up and nobody stopped to check what is actually costing to get it.

Years ago, here's an example of how this can look, where we get distracted.

between revenue and, well, what's actually happening, though, in the background that's either causing the revenue or it's happening at the same time, either disconnected decisions, especially as a business gets bigger and you've got people, you know, in the teams that are running different parts of the business that, you know, Their units are not, you know, producing, you know, they're not money producing units.

They cost a lot of money.

You know, advertising, for instance, design.

We've got to have them, but there is an expense to them.

Many moons ago, you may remember the advertising campaign by Taco Bell, the Chihuahua, right? So for three years.

I mean, they sold plushes, they sold t-shirts, they sold merch, there was commercials everywhere, billboards, television, radio, blah, blah, blah, blah, blah, blah.

Here's the reality.

At the end of the day, that campaign did not sell one more food item, tacos or whatever.

As a matter of fact, their sales actually went down, which is, if you remember the campaign, If you remember that time period, you would automatically assume because it was everywhere.

Well, they finally had to wrestle with the fact this is not working.

But the unfortunate truth is, especially smaller businesses that are doing $10 million and less for sure, which is, by the way, the swath of all businesses, if you don't know that.

90% of businesses fall underneath a couple of million bucks, believe it or not.

It's all the Jew, right? It's all the small businesses, the HVAC company.

The dry cleaning company, the CPA, the accountant, the pest control companies, that's what makes up the majority of businesses.

And so oftentimes it's not unusual to not truly pay attention to what's happening under the hood.

And that's the challenge.

When we look at Proverbs 21.5, good planning and hard work lead to prosperity.

but hasty shortcuts lead to poverty.

Growth without a plan for margin is haste wearing ambitions clothes.