Revenue is Overrated: Why Margin Pays the Bills

"revenue doesn’t keep the lights on, margin does" Greg Khan

When business owners talk about growth, the conversation often starts and ends with revenue. Bigger sales numbers. More projects. More customers. The top line becomes the trophy everyone chases.

But here’s the hard truth: revenue doesn’t keep the lights on, margin does.

Revenue Can Be a Distraction

Revenue looks impressive, but it can also be deceiving. Too many businesses chase turnover without asking the critical question: What’s left at the end of the month?

I’ve seen businesses double their revenue and still end up in financial distress. Why?

Because every extra dollar of sales came with equal or greater costs, staffing, materials, overhead, financing. When your margins are thin, more revenue simply means more work, more risk and more sleepless nights.

Margin Pays the Bills

Margin is what pays the rent, covers payroll, keeps the bank happy and ultimately delivers profit to the owners. It’s the oxygen of business. Without it, your revenue growth is meaningless.

Think about it this way:

• A $5 million business with 10% net margin generates $500k in profit.

• A $3 million business with 20% net margin generates $600k in profit.

The smaller business is actually the healthier one. It’s working smarter, not harder.

Work Smarter, Not Harder

If you’re stuck on the revenue hamster wheel, it’s time to change the conversation. Stop asking: “How do we sell more?” Start asking: “How do we sell better?”

That means:

• Pricing your services based on value, not just market rates.

• Identifying and eliminating low-margin products or customers.

• Streamlining processes so overhead doesn’t balloon as you grow.

• Investing in technology and systems that reduce waste.

• Training your team to focus on profitability, not just sales targets.

Smart businesses grow by protecting and expanding their margins not by chasing every dollar that comes through the door.

Final Thought

Revenue might make you feel good, but margin makes your business sustainable. It pays the bills, funds growth and puts money in your pocket.

So next time you review your financials, don’t ask “How big is the top line?” Instead, ask the question that really matters: “How strong are our margins?”

Because at the end of the day, it’s not revenue that builds wealth, it’s profit.

by Greg Khan