From losing money to a 30% margin improvement in 12 months

The Situation

A husband-and-wife plumbing business in Perth’s northern suburbs had been growing steadily for five years — more staff, more jobs, more revenue. But take-home pay hadn’t moved. The harder they worked, the further behind they seemed to fall.

They came to us frustrated and exhausted, convinced they might need to scale back or sell.

What We Found

Within the first session it was clear the core problem was pricing. The business had never properly calculated its true cost of doing business — labour on-costs, vehicle expenses, rework time and administration had all crept up over the years, but their hourly rate hadn’t kept pace.

They were also carrying three staff members whose billable hours didn’t justify their cost, and had no system for tracking job profitability. Some jobs were making money. Many weren’t. They had no way of knowing which was which.

What We Did Together

Over the following months, working closely with the owners, we:

• Rebuilt their pricing model from scratch based on actual costs and target margin
• Introduced a simple job-costing system they could manage themselves
• Helped them have honest conversations with underperforming staff
• Put a monthly review process in place so they could catch problems early

We also worked through their fixed cost base and identified two areas of unnecessary expenditure that were easy to eliminate.

The Result

Within 12 months, gross margin had improved by 30%. The owners were working fewer hours and taking home more. They kept all their staff — the conversation about performance turned out to be easier than expected, and two of the three lifted their output significantly once expectations were clear.

The business now has a monthly rhythm of financial review that the owners manage themselves in under an hour.