Profitability: The Most Important Metric for Sustainable Growth
When it comes to growing a business, the allure of big revenue numbers often takes center stage. Entrepreneurs set goals like hitting multiple six, seven, or even eight figures, imagining that reaching those milestones equates to ultimate success. But here’s the truth that many seasoned business owners learn the hard way: revenue, by itself, is just a vanity metric.
What truly determines the health and sustainability of your business is profitability.
Let’s dive into why profitability matters more than revenue by itself, the common myths that hold entrepreneurs back, and the mindset and strategies you can use to prioritize profit for long-term success.
Busting the Revenue Myth
Many entrepreneurs operate under the belief that hitting a certain revenue level will magically solve all their business challenges. “If I can just make $10K months”, they think, “everything will fall into place.” But revenue is only part of the story.
Revenue is the total amount of money your business brings in - think about it as your top line. Profit, on the other hand, is what’s left after you pay all your expenses—the bottom line. It is the money that fuels your growth, supports your personal income, and allows you to reinvest in your business. Without profit, you’re stuck on a hamster wheel, working harder and harder to sustain a business that’s financially fragile.
Understanding the Business Eras: Grow, Stabilize, Scale
Every business goes through three primary phases:
The Growth Era: This is the early stage, where revenue increases rapidly, and most entrepreneurs focus on acquiring new clients or customers. While exciting, it can also be financially and emotionally costly—you can be on the verge of burnout or investing heavily in support and visibility without a clear profitability goal.
The Stabilization Era: At this stage, you’ve achieved consistent revenue and are focused on refining your operations. The goal here is to optimize profitability—streamlining expenses, fine-tuning pricing, and ensuring your business model is sustainable.
The Scaling Era: Now, it’s time to expand without losing profitability. Scaling is about increasing your impact and revenue while maintaining your profit margins. This often requires strategic hiring, better systems, and a clear understanding of where your money is best spent. In this era, sometimes your profitability will take a hit, but it has a purpose and a strategy behind it—you slow down to gain momentum.
A sound profitability strategy ensures that your business thrives in all three phases. Without one, growth can quickly lead to burnout, instability, and cash flow issues.
Shifting Your Mindset Around Profit
Prioritizing profitability starts with a mindset shift. Here are three key beliefs to adopt:
Define What Success Means to You: Recognize that hitting a revenue milestone is not the same as building a successful business. Success is more about the lifestyle, the opportunities, and how you want to feel and behave than simply a number.
Journal Prompt: What does a successful life look like to me? How do I feel? What do I do? What is different from my current life, and what is the same?
Profitability Is a Form of Freedom: When you have healthy profit margins, you gain the freedom to make decisions that align with your values—whether it’s working fewer hours, hiring support, or scaling your offerings.
Journal Prompt: What financial security/freedom looks like to me? Which steps can I take today to get there?
Your Business is NOT Who You Are: Your business might be your “baby,”—but it is merely an expression of what you do. When you dissociate your worthiness from your business, it becomes easier to make decisions that move your business forward and stop getting personal validation from how your business performs. For instance, you can now find your MVP (Minimum Viable Price) without the belief that your price = your worth.
Journal Prompt: In which ways am I getting my sense of worthiness from my business? What are 5 things that I know to be true about myself that are not related to my business? What is the value that my business provides to my clients, and what does it add to my life?
Strategies to Increase Profitability
Ready to prioritize profit? Here are practical steps to get started:
Audit Your Expenses: Take a hard look at where your money is going. Are there subscriptions, tools, or services you no longer need? Are you overinvesting in areas that don’t generate a strong ROI? Streamlining expenses can free up cash for more impactful investments.
Reevaluate Your Pricing: Pricing is one of the most critical levers for profitability. You can use my Pricing Tool Bundle to confidently set prices that reflect the value of your work. Remember, clients are willing to pay for expertise and transformation, not just time.
Diversify Revenue Streams: Adding complementary offers can boost your profitability without requiring significantly more effort. For example, a service provider might create digital products or intensives that serve different segments of their audience.
Focus on Retention: It’s often cheaper to retain a client than acquire a new one. Consider creating long-term packages, adding value through exceptional service, and building strong relationships with your existing clients.
Set Profit Goals: Just as you set revenue goals, start setting profit goals. Aim to increase your profit margin over time, even if it means temporarily slowing revenue growth. My Revenue Planner Worksheet can help you map out a plan to achieve this.
A Client Success Story
One of my clients, a seasoned entrepreneur, came to me with a common frustration: They wanted to hire support but felt that they never had enough money. Despite consistent revenue, they were stuck in a cycle of doing everything themselves, leading to burnout and missed opportunities.
We worked together to develop a profitability strategy. First, we audited their expenses, eliminating unnecessary costs. Then, we identified their MVP—Minimum Viable Price—and adjusted their prices to be profitable and to reflect their value. Finally, we created a clear blueprint to start saving money to hire support.
Within a few months, they had the financial clarity and confidence to bring on a team member. This not only freed up their time but also allowed them to focus on high-impact activities and provide their clients with a better customer experience. Today, their business is more profitable than ever, and they’re scaling with ease (they have hired 5 other full-time employees using the same strategy!).
Tools to Support Your Profitability Journey
If you’re ready to take control of your profitability, I invite you to explore these resources:
Revenue Planner Worksheet: Map out your revenue and profit goals for the year, and create a plan to achieve them.
The Expansion Hour: Book a single session with me to gain clarity, heal money blocks, and create a 90-day blueprint for profitability.
Final Thoughts
Profitability isn’t just a number—it’s a reflection of the health, sustainability, and freedom of your business. By shifting your mindset, focusing on the right metrics, and implementing strategies to optimize your profit, you’ll create a business that not only thrives but also supports the life you’ve always envisioned.
Ready to take the next step?
Get your journal, do the prompts, download the Revenue Planner Worksheet, and start transforming your profitability today.
Remember, every big change starts with one small intentional action.