How to stop the silent profit killers in your business

For many business owners, growing revenue is the main focus. More sales, more customers, more work. But what if your biggest problem isn’t making money, it's keeping it?

Profit killers are the hidden drains on your business that slowly eat away at your margins. You might be working harder than ever but seeing little to no difference in your bank balance. If that sounds familiar, it’s time to take a closer look at where your profits are disappearing.

Pricing that’s too low (or just completely wrong)

Many businesses set their prices based on what they think customers will pay, or 'going rates', rather than what actually covers their costs and delivers a profit.

If you’re constantly busy but your cash position isn’t improving, it could well be your pricing that is the issue. Underpricing leads to overworking, stress, and a business that feels like a job rather than an asset.

You need to review your costs properly, understand your profit margins, and make sure you test price increases. You don’t need to be the cheapest, but you do need to be profitable.

Jobs that take longer than expected

Every extra hour spent on a job eats into your profits. Yet, many business owners don't even bother to track the actual time tasks take.

• Are you including for EVERYTHING you need to get the job done in your quotes?
• Do you regularly check how long jobs really take versus how long you have priced for?
• Are there regular and repeating inefficiencies slowing you or your team down?

Time is money, literally. If you are constantly overrunning on projects, you are absorbing those costs. Get strict on time tracking and adjust your pricing accordingly.

Creeping overheads

Small costs add up very fast. What started as a few necessary expenses can quickly turn into a bloated cost base that eats away at your profits.

• Do you regularly review your subscriptions, software, and services?
• Are rent, wages, or supplier costs increasing without you adjusting your prices?
• Are you spending on things that don’t directly contribute to revenue?
• Are you allowing for the cost of inflation on long term projects?

A quick audit of your expenses can reveal unnecessary costs that need cutting. If it’s not essential, bin it.

Payment delays suffocate your cashflow

You might be profitable on paper, but if customers take forever to pay, your business will constantly feel strapped for cash.

• Do you have clear payment terms in place?
• Are you chasing overdue invoices immediately and consistently?
• Have you considered taking deposits or staged payments to improve your cash flow?

Late payments aren’t just frustrating, they can hugely reduce your ability to operate. Get on top of your invoicing process and don't let slow payers hang on to YOUR money.

Unprofitable customers

Not all customers are worth having. Some demand too much time, want constant discounting and cause endless headaches. You'll know who these customers are just by speaking to them.

• Do you have a handful of clients taking up most of your time for little return?
• Are you saying yes to low-margin work just to stay busy?
• Would your business be better off without certain customers?

A profitable business isn’t about saying yes to everything. Often, it’s about knowing when to say no.

Stop the leaks and keep more of your profit

You don’t always need to work harder, but you definitely need to work smarter. More sales won’t fix a business that leaks money.

Take a step back, audit your numbers, and fix the silent killers before they do any more damage.

Where is your business losing profit right now?