The 1% That Isn't 1%
Move two numbers in your business by 1% each.
Then watch a third number.
It does not move 2%. It moves closer to 30%. Same customers. Same offers. Same team, same everything.
I want to show you why, because once you see it, you cannot unsee it. And most founders go years without anyone showing them.
Here are the two numbers. Your price, and your cost.
Nudge your price up a little. Trim your cost a little. Both of those changes land in the same place: the bottom. And the bottom is a much smaller number than the top, so a small move looks tiny on revenue and enormous on profit.
Let me put real figures on it, because this is the part founders do not believe until they see it.
Say you do $2M in revenue. Your costs run $1.75M. So you keep $250K. A good business.
Now, two small moves.
Raise your price about 2%. Not a repricing. Not a new tier. Just 2%. That is $40K, and almost all of it falls straight to profit.
Trim your costs about 2%. One renegotiated vendor, one subscription nobody uses, one process that quietly wastes money. That is another $35K.
Add them up. You went from $250K to $325K.
That is 30% more money in your pocket. On the same $2M. Same clients, same offers, same hours from you.
Not 2%. Thirty.
I say this with love: you have spent the last year trying to add revenue. Chasing the next channel, the next launch, the next $200K on the top. And the whole time, a third of your profit was sitting in two levers you can move from your desk.
This is the thing about profit. It is not a big number that shrinks a little when you are careless. It is a thin number that swings hard when you touch the levers on either side of it. Which is wonderful news, because it means the money is already in the building. You do not have to go get it. You have to stop leaving it.
Here is the catch, and it is the only reason this is hard.
You cannot move a lever you cannot see. Most founders are reading the whole business through one number, the balance in the bank, and that number will never once tell you that your price is 2% low or your costs are 2% loose. It only tells you what already left.
So sit with three questions.
If I raised my prices 2% on Monday, how many clients would actually leave? (Be honest. It is almost always fewer than you fear.)
Where is my 2% of loose cost hiding right now, and do I even have it in front of me to look at?
And the real one. Am I chasing revenue because it is the lever that matters most, or because it is the only lever I know how to read?
The fact that you are not sure is the whole point.
This weekend, pull your P&L. Find your two levers. You can run this exact math yourself, and I hope you do.
And if you want to do it live, on your real numbers, with me pointing at the two you cannot see, that is the whole reason I run the Cash Flow Breakthrough workshop. No pressure. The math above works whether we ever talk or not.
You don't have a revenue problem.
You have a 1% you've never been shown.
Cruz
Originally published on LinkedIn.
