How to make profitable services focusing on 5 simple steps

How to make profitable services focusing on 5 simple steps

Know your most profitable services

What service is most profitable? Running a profitable service-based business that runs like clockwork with healthy profit margins can be hard.

Understanding what it means to be a profitable service business and how you measure the direct costs against your different services is difficult.

We have developed a step-by-step financial tool to help all service-based businesses calculate how profitable they are. Introducing one of our newest OutRise tools: The Service Powerhouse

How do you know what the most profitable service is?

Firstly, you need to figure out what kind of services you sell. Are you able to productise these services and place them in definitive categories? 

If you know how many clients you sell your services to, how often you sell to them and your average fees, then you can start to map out your fee levels and whether this looks sensible and realistic.

This is where our tool starts – it gets you thinking about the structure of your fees first.

Make better decisions, through data

Steering your business based on gut instinct alone is tough. Our tool will help you make data-driven decisions. Knowing which services are your most profitable affects your other decisions.

How to resource your team? Do they have the right skill set for our more high-ticket services? Do they have the capacity to be able to deliver your services?

profitable services
Which services are profitable?
  • Focused marketing: Focus your resources on promoting your services that are profitable, attracting the right clients with the right work for your team.
  • Pricing with precision: Reveal the true value of your services, so you can pitch with confidence.
  • Capacity planning: Channel your efforts towards nurturing and scaling your star performers. Invest in what pays off, optimise your team costs, and maintain that strong team cost to fee ratio.

Allocate direct costs

This tool tackles the age-old nightmare of direct employment cost allocation. Allocating your direct costs can be a confusing exercise.

Our calculator makes this simple and easy to understand, ensuring each service bears its fair share of the cost burden. This will allow you to see crystal-clear profit margins for each service that you offer.

What if I don’t use this tool?

If you ignore service profitability, you are likely to be ignoring one of the key metrics your business needs to reach higher heights. If you know these numbers, you will find that a lot of other decisions you make about your business will make a lot more sense. 

Don’t use it and you’ll never know

  • Wasted resources: Selling services that drain your time and finances, hindering your ability to invest in your profitable services. 
  • Ineffective marketing: Spending valuable marketing budgets on promoting mediocre services, which yield minimal return.
  • Missed opportunities: Leaving high-profit services under-priced and under-promoted, failing to capitalise on growth.

Use it and you’ll see

With this tool you will be able to navigate through your numbers with confidence. Your business will start to make more sense, and you will be able to solve any areas of concern. Don’t be a passive observer in your own business; be an active catalyst for change.

It can help you to look at the next steps you need to take to improve your service profit margins.

What will you gain?

  1. Upsell and cross-sell: Focus on bundling your profitable services, offering packages that boost your average service value and client satisfaction. Leverage the success of your star services to offer complementary or premium options, boosting what your clients buy from you.
  2. Niche down, shine bright: Hone your offerings to cater to your client’s needs, becoming the undisputed champion in your niche.
  3. Package your services: Bundle high-profit services with less profitable ones, creating attractive packages that increase overall value and profitability.
profitable services
No more guesswork

A must-have for your business toolbox

Think of your business thriving and growing in the right direction. To do this, you must know your numbers. To tackle what comes next and overcome that next hurdle.

Ditch the guesswork and unlock the key metrics you need for your business to succeed. This tool will help you with this. Use it to help you navigate your next steps with ease.

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