Your margins aren't shrinking because your costs are too high. They're shrinking because of who you're selling to — and what you're letting them buy.

When margins compress, the boardroom reaches for the same playbook every time. Cut costs. Renegotiate suppliers. Squeeze headcount. It feels decisive. It's usually wrong. The real margin killers are quieter. And they're almost always hiding in the revenue line, not the cost line.

Two customers. The majority of volume. And over time — gradually, quietly, the way these things always happen — those two customers had used their buying power to push orders toward the company's least profitable products. The sales team didn't fight it. Why would they? They were getting paid on revenue.

The business looked fine from the outside. Inside, it was being hollowed out one order at a time.

We changed the incentive. Pay the sales team on margin contribution, not top-line. Point them at the highest-value product lines.