When the owner of a family-owned business came to us, he shared something we hear a lot: “I think I’m making money, but I don’t know for sure. Is my pricing set up the right way?”
He’d been figuring out his gross margin by subtracting commissions and overhead from sales. But even with a profit target in mind, he couldn’t see where he really stood—or how to confidently reach his goals.
How We Approached It
After digging into his financials, we found that, while technically profitable, the business was much closer to breaking even than he realized. It wasn’t anywhere near the profit percentage he wanted. Knowing that wasn’t the news he was hoping for, we set out to share a clear picture of where his business really stood—and what steps he could take to move forward.
What We Did Together
Once we had his financials in focus, we mapped out a plan to hit his profit goals. The key here is understanding that it’s never just one thing—profitability is all about balance. We talked through how small adjustments in a few key areas could make a big impact, including things like:
- Raising prices strategically to match his desired profit margin.
- Cutting unnecessary overhead costs while keeping quality intact.
- Setting realistic, scalable goals for profitability.
- Increasing revenue to lower the percentage of overhead costs.
Ultimately, we knew we needed to find the right combination of levers to pull to get him to his goals.
Building a Roadmap
Once he understood where his business stood financially, we were able to help him outline both short- and long-term strategies. The more immediate change might involve making tweaks to pricing and overhead to improve his margins, with a long-term plan to increase sales, knowing that as revenue grows, overhead naturally becomes less of a burden.
Staying Profitable Moving Forward
Like just about everything in finance—and life—I’ve learned staying on track with profitability means staying on top of all of the factors that go into it, including regularly reviewing financials, and identifying opportunities for efficiency.
What About Your Business?
Juggling the day-to-day of your business and putting out whatever fires arise often takes priority over the more strategic tasks of trying to figure out if your business is really as profitable as it should be. That’s exactly where my team comes in. We’re here to help you get clarity, create a plan, and take the guesswork out of your numbers.
Have you been wondering about your profitability?
Or maybe you’re tired of wondering where the profit your books show is actually going.
That’s where my team comes in. Reach out today—I’d love to help you hit your goals and feel confident in your financial future.
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