If you’re running a DTC brand, eCommerce business or anything in between, you’re likely asking yourself a version of this question all the time:
How much can we grow this year – and how fast can we do it?
And while the answers might feel complex, the actual mechanics are surprisingly simple. Growth, at its core, is mathematical. It’s not just about scaling ad spend or hitting revenue targets – it’s about how your business handles two very specific things: profit and speed.
Let’s break it down like we would in a client strategy session.
Revenue Growth is a Cycle – And a Simple One at That
When you strip everything back, revenue growth follows a compounding cycle:
Cash invested → Return generated → Cash + Return reinvested
In other words, you’re putting money into the business (say, through paid ads or stock), generating a return, and then reinvesting both the initial capital and the profit. Rinse and repeat.
So your growth potential over time hinges on two factors:
- How much return you generate (i.e. profitability)
- How quickly you generate it (i.e. asset turnover)
That’s really it. Those two things – nothing more, nothing less – are the levers that determine how fast your business can grow organically.
Which brings us to two fundamental metrics most marketers don’t talk about enough:
- Net Profit Margin (NPM) – How much profit you make on every £1 in revenue
- Cash Conversion Cycle (CCC) – How long it takes to turn an investment into cash in the bank
The Growth Matrix: Profitability vs Efficiency
Picture a matrix. On one side you’ve got Net Profit Margin. On the other, Cash Conversion Cycle. Your ability to grow sits at the intersection of the two.
- High NPM means more cash to reinvest each time you make a sale.
- Low CCC means you’re recycling that cash faster and getting to the next sale sooner.
Let’s look at a simple example.
A business with a 7% Net Profit Margin and a 100-day Cash Conversion Cycle will only be able to grow by around 28% per year – assuming it’s only using internal cash (no borrowing or fundraising).
Now, this is where things get interesting…
Say that same business has two optimisation options:
- Increase profit margin from 7% to 11%
- Improve CCC from 100 days to 60 days
Which one would drive more growth?
Optimising CCC to 60 days gives a 51% growth potential.
Increasing NPM to 11% only gives 46% growth.
So, even though both are good, faster cash turnaround beats higher profit margin in this case.
Why This Matters for Your Growth Strategy
As a PPC agency, we’re constantly looking at data, ROAS, MER, and all the usual suspects. But these numbers don’t tell the whole story of your growth engine.
That’s why this framework is so valuable. It forces you to ask bigger questions:
- Should you focus on becoming more profitable?
- Or would you grow faster by increasing operational efficiency?
Most brands instinctively chase higher margins – raise prices, cut costs, squeeze more out of every sale. But often, the smarter move is to look at how quickly you’re recycling capital. How long does it take you to turn an ad click into a profit that’s back in the game?
Practical Ways to Improve Your CCC
If you’re thinking, “Alright, how do we actually improve CCC?” – here are a few places to start:
- Optimise fulfilment and logistics – Faster delivery = faster payment cycles.
- Improve stock management – Avoid cash sitting in slow-moving inventory.
- Tighten up receivables – Get paid faster from wholesale or B2B orders.
- Test leaner campaigns – Reduce CAC and increase velocity, not just volume.
Speed kills – in a good way. Especially when it comes to compounding returns.
Final Thought: It’s Not Just About Being Profitable
This is a shift in mindset. You don’t need to choose between profitability and speed. You need to understand which one is the bottleneck right now.
For most growing brands we work with, it’s not a lack of profit that’s stalling growth – it’s how slowly that profit cycles back into the system.
So before you overhaul your pricing, or try to stretch your ROAS another decimal point, take a look at your CCC. Chances are, that’s where the real opportunity is hiding.
