Most SMEs talk about growth.
More customers. More revenue. Bigger markets. 

But here’s the catch:
Growth isn’t free. And it often comes at the cost of profit. 

At RJP Consulting, we’ve worked with dozens of businesses chasing topline targets—only to realise too late that their margins have collapsed or cash flow is strained. 

So let’s talk about the trade-off that’s hiding in plain sight: 

The tension between growing fast and staying profitable. 

According to the UK Department for Business and Trade, SMEs account for 99.9% of the UK business population, employing over 60% of the workforce—but they also represent the majority of business failures each year, with poor financial planning cited as a leading cause. 

 

Growth Feels Good… Until It Doesn’t 

Everyone loves a hockey-stick chart.
But beneath the curve, most growth stories hide things like: 

• Discounting to win volume 

• Extra hires to deliver inconsistent demand 

• Complicated onboarding or delivery cycles 

• Higher debt loads to fund expansion 

And that all chews into margin. 

According to a Xero SME Benchmarking report, over 60% of small businesses that scaled quickly saw a drop in net profit in the first 18 months. Worse—many couldn’t recover. 

Because growth without margin = cash burn.
And SMEs don’t have the capital buffer that big corporates do. 

 

The False Logic of “We’ll Make It Up Later” 

We often hear this:
“Let’s focus on revenue now—profit will come when we hit scale.” 

Sometimes that’s true.
But most SMEs never hit the scale they imagined. 

• CAC (customer acquisition cost) doesn’t fall fast enough 

• Churn offsets growth 

• Complexity grows faster than income 

• Teams are firefighting, not building efficiency 

You can’t bank on “eventual scale” unless you’ve proven you can get there with margin intact. 

 

So Why Do Businesses Chase Growth Over Profit? 

Three big reasons: 

1. Vanity metrics – Revenue feels good. It attracts investors, headlines, and award entries. But margin is harder to celebrate. 

1. Sales-led culture – The loudest voices push for targets, and few challenge the commercial logic. 

1. Misaligned incentives – Bonuses and KPIs often reward topline performance—not sustainable profit or delivery cost. 

Add a board that wants “aggressive growth,” and the pressure builds fast. 

 

You Need a Clear Growth Thesis 

We always ask clients: 

• Why grow now? 

• What will it cost us to grow? 

• Where is that growth actually coming from—new markets, new products, or deeper share of existing ones? 

• Are there real economies of scale to be had—or are we just adding complexity? 

• Can any part of that growth be automated or made scalable through technology? 

• Do we know where the margin really is in our portfolio? 

• Are our internal processes ready to handle more customers? 

• Are we growing outside our core competency? 

• What are competitors doing—are they coming after our space? 

• Do we have the cash to support growth that doesn’t convert to profit immediately? 

If the answers are vague—you’re gambling, not planning. 

 

What You Should Be Doing 

Know your true unit economics 

Get forensic about: 

• Margin by product/service 

• Cost to serve each customer segment 

• Discounting behaviour 

• Operational load created by growth 

Stress-test your delivery model 

Growth usually means: 

• More onboarding 

• More support tickets 

• More service variability 

If your ops team is already stretched, growth will expose the cracks. 

Align incentives with sustainable performance 

Rewire targets to reward profitable growth—not just activity. 

• Reward margin retention, not just revenue 

• Link bonuses to customer lifetime value 

• Build shared KPIs between sales and delivery teams 

Make space for profit-led decision-making 

Some customers aren’t worth winning.
Some products shouldn’t scale.
You may need to slow down to fix underlying cost models before ramping back up. 

“Revenue is vanity. Profit is sanity. Cash is reality.”
(Old CFO saying that still hits hard in 2025.) 

 

How RJP Consulting Helps 

We support SMEs to: 

• Model the real trade-offs between growth and profit 

• Rationalise portfolios to focus on high-margin offers 

• Align go-to-market and operations to reduce delivery drag 

• Build growth plans grounded in financial sustainability—not fantasy 

• Restructure incentives to prioritise margin, not just movement 

 

Final Thought 

Growth is exciting.
But profit pays the wages. 

If you’re chasing volume without understanding the cost—you’re not scaling.
You’re leaking. 

For years, strategy meant locking into a market, building share, and scaling.
Pick a segment. Build a moat. Defend your turf. 

That model’s breaking down. 

Now?
The ground shifts faster than most leadership teams can update their slide decks. 

At RJP Consulting, we’re seeing a fundamental shift: growth no longer depends just on where you play—but also on how fast you can adapt when that playing field changes. 

 

The Old Rules Don’t Hold 

The traditional approach looked something like this: 

1. Identify your core market 
2. Build a portfolio around it 
3. Optimise the model 
4. Extract value over time 

But in today’s climate—defined by geopolitical volatility, AI-driven disruption, rising costs, and buyer fatigue—static focus becomes fragility. 

Markets evolve faster than most organisations can execute. 

According to a 2024 BCG report, over 60% of business leaders say their core market assumptions have changed in the past 18 months. Yet only 1 in 4 have meaningfully adjusted their strategic plans. 

The danger? Treating volatility as temporary—when it may be the new baseline. 

 

The Strategic Risks We See Weekly 

• Companies over-invested in declining customer segments 
• Products still aimed at problems that no longer exist 
• Sales teams targeting too many verticals with unclear positioning 
• Ops stretched across multiple delivery models that no longer scale 
• Boards sticking to 3-year plans written for markets that have already moved on 

In uncertain markets, complexity isn’t a hedge—it’s a cost. Strategic indecision becomes operational drag. 

 

Focus Doesn’t Mean Narrow 

When we talk about “where to play,” we’re not just talking about geography or industry.
Strategic focus means clarity on: 

• The customer problem you’re solving 
• The buyer type you’re targeting 
• The delivery model you’re resourced to execute 
• The value chain position you can defend and scale 

And critically—what is your core competency?
Are you operating in areas that play to your strengths, or drifting into offers and markets that dilute what you do best? 

If your strategy isn’t anchored in your competitive advantage, your execution will suffer. 

Many businesses confuse opportunity with strategy. Just because a market is growing doesn’t mean you should be there. 

Strategy is about fit—not just size. 

 

What Happens Without Focus 

• Bloated portfolios with no clear core 
• Sales collateral that tries to speak to everyone—and connects with no one 
• Teams constantly pivoting between priorities 
• Leadership wasting time “chasing tail” rather than doubling down on what works 

According to McKinsey, companies with high strategic clarity outperform peers by up to 30% in EBITDA growth over five years. Yet most leadership teams spend less than 15% of their time on strategic focus and portfolio decisions. 

It’s not just about being right. It’s about being lean enough to move quickly. 

Look at Elon Musk’s approach at Twitter (now X): he stripped out huge numbers of staff who weren’t materially contributing to profitability. Costs plummeted almost overnight. Revenues dipped slightly, but profitability surged. 

The message? You don’t need everyone—you need the right ones. 

A Harvard Business School study found that just 20% of employees typically drive 80% of a company’s value-creating output. When lean, focused teams align behind a clear strategy, agility and execution improve exponentially. 

Whether or not you agree with the tactics, the principle is clear: you can’t pivot if you’re bloated. 

 

So What Should You Do? 

Pressure-test your current focus 

Ask: 

• • Is this segment still growing profitably? 
  • Are we genuinely differentiated here? 
  • Can we scale without reinventing the model? 
  • Does this align with our core competencies? 

If the answer’s “sort of” or “maybe”—you’re exposed. 

Re-align resources 

Growth doesn’t come from spreading thin.
It comes from placing sharper bets with clearer execution. 

Kill zombie projects. Re-deploy capital and people to where the real opportunity lies. 

Gartner found that companies who reallocated 20%+ of budget annually toward high-potential segments saw 2x the revenue growth of those who didn’t. 

Be prepared to pivot 

Focus doesn’t mean rigidity.
Build optionality into your strategy—adjacent segments, modular offers, delivery flexibility. 

If the ground shifts again, you’ll want room to move. 

Cut complexity and automate where possible 

Ask: 

• • Can we automate repetitive or low-value processes using AI or workflow tools? 
  • Can our sales process be standardised to avoid bespoke offers? 
  • Are our products and pricing creating unnecessary complexity across ops? 
  • Lean strategy means simplifying how you operate—not just what you offer. 

Review the supply chain and channel model 

Look hard at your routes to market: 

• • Are there middlemen or channel partners adding cost without value? 
  • Could you shift to a direct-to-customer model—or consolidate partners? 
  • Are your distribution and service models aligned with how customers now want to buy? 

The best strategies don’t just focus outward. They simplify inward. 

 

How RJP Consulting Helps 

We work with leadership teams to: 

• Run strategic focus and market fit assessments 
• Align product, sales, and delivery models with highest-fit segments 
• Identify segments that have outlived their value 
• Strip out complexity and unnecessary costs from operations 
• Develop modular execution plans that support focused scaling—with flexibility built in 
• Automate internal processes and rationalise delivery models 

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Final Thought 

“Where to play” is no longer a one-off decision. It’s a discipline—and the businesses that get it right don’t just grow.  They stay alive longer than their competitors.

Most companies don’t suffer from a lack of products.
They suffer from too many—and the wrong ones. 

Over time, portfolios get bloated with legacy offers, experimental add-ons, and bespoke one-offs for “strategic clients.” And instead of fuelling growth, they dilute it. 

At RJP Consulting, we’ve seen how unchecked portfolios create operational drag, confuse sales teams, and erode margin. The biggest issue? No one’s really in charge of cleaning them up. 

 

The Hidden Risks of a Bloated Portfolio 

1. Too Fat: No One’s Culling the Dead Weight

Most businesses add products far more often than they remove them.
Why? Because killing an offer feels risky—even when it’s not working. 

But let’s be clear: 

• Products with low/no margin aren’t strategic 

• Products that no one can operationally support are liabilities 

• Products that don’t align with current market demand shouldn’t be there 

Still, they persist. Why? 

• Pet projects: Product managers need to justify their existence, and admitting defeat is hard 

• Overlapping offers: Multiple products do roughly the same thing, with minor differences and loads of internal politics attached. (Ironically, the car industry does this well—multiple models built on the same base platform.) 

• Bespoke-for-one: A legacy deal for a “key customer” that now costs more to service than it brings in 

• Fear of churn: Products stay live just because no one wants to rock the boat with a handful of vocal customers—even if the product doesn’t fit the current operating model 

If you can’t explain who it’s for, what problem it solves, and why now—it doesn’t belong. 

 

2. Too Slow: Delivery Can’t Keep Up

Complex portfolios slow everything down: 

• Sales cycles stretch while reps try to explain unclear offers 

• Delivery teams build workarounds to fulfil odd combinations 

• Ops teams drown in exceptions, approvals, and custom terms 

Each new product adds operational overhead. You need new processes, new training, new billing codes, new service terms. 

According to Bain & Company, companies with low portfolio complexity grow revenues up to 30% faster and earn margins up to 25% higher than their more complicated peers. 

When your product mix exceeds your ability to deliver efficiently, you’re not innovating—you’re suffocating. 

 

3. Too Misaligned: What You Offer ≠ What the Market Needs

The market evolves. Most portfolios don’t. 

Many firms don’t stop to ask: Does our offer still solve the current problem? 

What once made sense may now be: 

• Overpriced 

• Over-engineered 

• Over-reliant on customers or channels that no longer convert 

• Misaligned with how customers want to buy today (eg. self-serve, digital, recurring) 

Or worse—it’s internally popular but externally irrelevant. The team loves it. The market doesn’t care. 

According to Deloitte, over 60% of failed product launches stem from a mismatch between product capabilities and customer needs. 

Relevance is not a static achievement. It’s a moving target. And portfolios need to be revalidated regularly. 

 

Common Portfolio Symptoms 

If any of these sound familiar, your portfolio needs work: 

• Products with <10% of revenue still get significant internal time 
• Sales teams avoid pitching certain products because they “don’t land” 
• Your support teams have cheat sheets just to process orders 
• Pricing strategies are inconsistent or overly reactive 
• Nobody owns the roadmap for simplification 

 

What to Do About It 

Run a product performance audit 

Don’t just look at revenue. Look at: 

• Margin contribution 
• Delivery complexity 
• Strategic fit 
• Market demand 
• Sales traction 
• Subscription cost-to-serve, even for dormant or low-usage customers 
• Feature overlap: could an alternative be offered instead? Can another product be adapted to serve both needs? 

If the product isn’t clearly better than what else exists—or easily rationalised—it’s probably not worth keeping. 

 

Segment the Portfolio 

Every product should fall into one of three categories: 

• Core: High-margin, high-demand, low-friction. These are the money-makers that customers understand and teams can deliver with confidence. Review quarterly. 
• Strategic: Products that serve emerging needs, future positioning, or test grounds. But they require active management, clear KPIs, and an exit plan if they don’t scale. 
• Retire: Legacy, underperforming, or low-fit offers. Keep them too long and they’ll drag down your margins, confuse your teams, and erode focus. 

Segmenting once isn’t enough. Portfolios need active governance to stay sharp. 

 

Rebuild Around Capability and Customer Value 

This is the hard bit—but it’s where competitive advantage is built. 

Ask: 

• Can we deliver this reliably, at scale, and profitably? 
• Does this clearly solve a valuable customer problem today? 
• Are our best people focused on this—or is it draining attention? 
• Is it distinct from the rest of the portfolio? Does it earn its place? 

Also consider: 

• Could we consolidate two products into one stronger offer? 
• Can customers be migrated to something better and shut the legacy product down? 
• Do we have the right support model to service this without operational strain? 

Rebuilding doesn’t mean a blank slate. It means ruthless clarity about what earns a place—and what doesn’t. 

 

How RJP Consulting Helps 

We support clients to: 

• Run portfolio audits across commercial, delivery, and operations 
• Identify product overlaps, gaps, and misfits 
• Remove unnecessary complexity from sales and service delivery 
• Align go-to-market strategies with high-performing, simplified offers 
• Rationalise SKUs and replatform overlapping products 
• Build internal frameworks for product lifecycle management and continuous simplification 

 

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Bottom Line

You don’t need more products.
You need the right ones—and fewer of them.

Because bloated portfolios don’t just slow you down.
They stop you from scaling.

Most businesses blame the market when growth stalls.

“Too much competition.”
“Prices are under pressure.”
“The economy’s slowing.”

Maybe. But more often, the problem isn’t out there. It’s internal.

At RJP Consulting, we’ve seen this play out across sectors—from fast-growth tech firms to long-established industrials. The real blockers? They’re almost always inside the walls.

 

The Real Growth Killers

Here are the blind spots we see most often:

1. Unclear Accountability

You’d be surprised how many leadership teams can’t answer: “Who owns this outcome?”

Responsibilities are diluted. Projects are run by committee. No one is tracking what actually gets delivered.

According to a Harvard Business Review study, 95% of employees don’t understand their company’s strategy. That disconnect kills momentum.

Growth doesn’t stall because of a lack of strategy. It stalls because nothing gets over the line.  And before you even start delivering—have you defined what you’re delivering? What does success look like? Is everyone aligned? Or is the strategy just words in a slide deck?

2. Misaligned Incentives

If your sales team is incentivised on volume, don’t be surprised when margin erodes. If your product team is measured on features shipped, expect complexity to spiral.

Incentives aren’t just internal, either. Many firms forget to align external incentives—channel partners, resellers, or distributors often don’t have a compelling reason to push your offer.

Growth is a system. If one part’s out of sync—it drags the whole machine down.

3. Product Bloat and Poor Go-To-Market Execution

That “strategic” product line you launched five years ago? It’s now a resource drain. It barely sells. But no one’s had the nerve to kill it. Even worse—many new products are launched with no real go-to-market strategy.

Here’s what’s typically missing:

• • Pricing: Set too high to move volume, or too low to drive profit
  • Promotion: Marketing isn’t equipped with the right messaging or assets
  • Placement: No defined channel strategy; is it direct, partner, or hybrid?
  • Enablement: Sales teams don’t understand the value proposition, or where it fits in the portfolio

According to McKinsey, only 40% of product launches meet their business objectives. A poorly executed launch isn’t just a miss—it’s fuel for internal friction. And often, the issue goes back further: Was the business case robust in the first place? Was enough resource allocated to meet customer expectations? Or did a product make it to market because someone “really believed in it”?

4. No Deep Sales Analysis

We often hear: “Sales are down.” But when you dig deeper, the business hasn’t actually looked at the numbers.

• • Which segments are declining?
  • Which reps are consistently missing targets?
  • Which products are being discounted to move volume?
  • What’s the conversion rate on inbound leads vs outbound efforts?

Without clear sales performance insight, it’s guesswork—not growth strategy.

5. The Execution Gap

You’ve got a great strategy. The board signed off. You even held a town hall.

Six months later…

• • No one’s tracking delivery
  • Teams have reverted to BAU
  • Half the initiatives are stuck in “pre-scoping”

Strategy doesn’t fail at the whiteboard. It fails when no one owns the messy middle.

 

So How Do You Fix It?

Step 1: Run a brutal internal diagnostic

This isn’t about pointing fingers—it’s about surfacing the friction that’s holding you back.

Ask:

• • Where are we creating drag?
  • What complexity are we tolerating?
  • What workarounds have become “normal”?

Step 2: Re-align incentives and decision-making

If the KPIs are wrong, the outcomes will be too. Make sure your growth drivers are reflected in how teams are rewarded and resourced—and make sure external stakeholders are aligned, too.

Step 3: Rationalise before you invest

More growth doesn’t come from more products. It comes from a sharper, cleaner offer and a business that’s easier to scale.

Step 4: Make delivery visible

Put ownership in black and white. Review regularly. Celebrate progress. Kill what’s not working.

 

How We Help

At RJP Consulting, we help organisations see what’s really in their way—and fix it.

We:

• Challenge leadership assumptions
• Run honest internal capability and sales performance reviews
• Remove complexity from product portfolios
• Build go-to-market strategies that work across pricing, promotion, placement, and sales enablement
• Develop realistic business cases that align to internal resource and market expectation
• Build execution plans that drive action—not just meetings

 

Bottom Line

If growth has stalled, don’t start with the market. Start with the mirror.

Because most businesses don’t lose momentum from the outside. They lose it from blind spots they stopped noticing.