When does the myth “more sales means more profit” fail to hold true?

This belief overlooks the complex relationship between revenue, cost, and profitability.

• High Sales, Low Margins: Deep discounts or expensive acquisition costs can kill profit.

• Hidden Operational Costs: Scaling too fast without infrastructure leads to inefficiencies.

• Returns, Refunds, and Defects: High volume doesn’t always equal customer satisfaction.

• Unsustainable Growth: Rapid growth may mask financial instability or cash flow issues.

• Cash Flow Crunch: If expenses outpace receivables, the business may struggle despite revenue.

Businesses must focus on profitability per sale, not just total volume.

• Related Articles

• How does the myth that processes kill creativity hold businesses back from innovation?

  There’s a widespread myth that processes and creativity are mutually exclusive. Many believe that rules, structures, and standardization suffocate innovation. However, the truth is that clear processes often enable creativity by providing stability, ...

• Which commonly believed business myth causes the most financial damage?

  Among all business myths, the belief that “If you build it, they will come” is arguably the most financially damaging. This myth implies that building a great product or service guarantees customer interest and sales. Why this myth causes financial ...

• Why do many digital transformation projects fail due to poor technology alignment?

  Many digital transformation efforts fail because they focus on implementing new technologies without aligning them with business goals, processes, or culture. This lack of alignment results in disjointed systems, low adoption rates, and missed ...

• How does the myth “the best product always wins” ignore market dynamics?

  Many business owners believe superior quality is enough to guarantee success. But markets are influenced by many factors beyond product excellence. Here’s what this myth misses: Timing and Market Readiness: A great product launched at the wrong time ...

• How does the myth that “failure means you’re not cut out for business” hinder entrepreneurs?

  This toxic myth equates failure with incompetence, discouraging learning and experimentation. Every Entrepreneur Fails: From Elon Musk to Jack Ma, failure is common. Failure Teaches Resilience: It helps refine ideas, models, and leadership. Pivoting ...