Straight answers, with the sums shown
The questions small business owners actually ask, answered directly and with real arithmetic rather than advice you cannot act on. No signup, nothing gated.
Pricing and price rises
What to charge, how to structure it, and how to raise it.
Should I raise my prices, or will I just lose the customers I have?
You will lose some, and that is the correct outcome rather than the risk. A 10% rise across the board typically loses 5–10% of customers in trades and services, which leaves you meaningfully ahead: at 10% more revenue per customer and 8% of customers gone, you are up about 1.2% on revenue while doing 8% less work. The people who leave over 10% are almost always the lowest-margin accounts you have.
My bookkeeping practice is completely full but I am not making enough money — what is wrong?
Almost certainly scope creep on legacy clients rather than underpricing new ones. In most practices the fee was set when the client was smaller, and transaction volume, payroll and extra entities have grown into it without the fee moving. Compare current monthly transaction counts against what the original engagement assumed — if a client has doubled in volume on the same fee, they are now paying roughly half your intended rate, and there are usually three or four of them.
We run a small MSP and our per-user pricing no longer covers what we actually deliver — how do we fix it?
Separate pass-through licensing from your service fee and stop absorbing vendor increases. Most small MSPs quietly swallow annual Microsoft and security-vendor rises to avoid a conversation, which permanently rebases their margin downward every year. Licensing should be billed as a distinct line that moves when the vendor moves, leaving your service fee to be negotiated on its own merits.
How much should a personal trainer charge for packages compared with single sessions?
Discount packs by 10–15% at most, paid up front, and make a monthly auto-billed plan your main offer. At $80 a single session, a 10-pack at $720 is $72 a session and a monthly plan of 8 sessions at $560 is $70. A 10% discount is recovered if the client books just 11% more sessions — about one extra session in every nine.
Should I switch my bookkeeping clients from hourly billing to a fixed monthly fee?
Yes, for recurring monthly work. Set the fee at the client’s average monthly hours over the last 6–12 months, times your rate, times 1.15–1.2 to cover variance. A client averaging 6.5 hours at $65 is $422.50; at 1.2 that is about $510 a month. When software cuts the work to 4.5 hours, your effective rate rises to $113 an hour instead of your invoice shrinking to $292.50.
Should I add a card surcharge to cover payment processing fees, or just raise my prices?
In most small service businesses, a small price rise is cleaner than a surcharge. If 85% of $400,000 revenue is paid by card at 2.9%, fees are $9,860 a year; a 2.5% price rise on everything brings in $10,000 and covers it with no extra line on the invoice. The rules on surcharging vary by country, state and card network, so check them before adding one.
How much should I charge for emergency and after-hours callouts?
Charge a callout fee that includes the first hour, then about 1.5–2 times your normal rate. At a normal $110 an hour, a $195 callout plus $165 an hour after that makes three two-hour callouts a week worth $1,080, against about $755 in on-call pay and overtime. Charged at the normal $110, the same week brings in $660 and loses $95.
How do I know if my auto repair shop’s labour rate is too low?
Compare the rate on the board with your effective labour rate: labour sales divided by hours billed. A shop posting $130 an hour that bills 96 hours a week for $10,560 of labour is really earning $110 an hour. That $20 gap — discounts, comebacks and underquoted jobs — is about $96,000 a year over 50 weeks, before the posted rate itself is even questioned.
Should I run small-group tutoring instead of one-to-one sessions to earn more per hour?
For most tutors, yes, for some of the week. At £45 an hour one-to-one, a group of four at £22 each is £88 an hour, and each family pays less than half the one-to-one rate. Moving 10 of 20 weekly teaching hours to groups lifts the week from £900 to £1,330, about £16,300 more over a 38-week school year.
Where the margin went
Busy but not profitable: finding the cost that ate the money.
I run a small commercial cleaning company and we are busy but barely profitable — what should I change first?
Check your two or three largest contracts first — in most small cleaning companies one or two accounts are being serviced at close to cost, and they are usually the oldest ones, priced years ago and never revisited. Work out the actual hours on site per month against what you bill for that account. If the effective rate is below your fully-loaded labour cost plus about 35%, that single contract is where your profit went, and repricing it moves more money than winning two new clients.
I think I am quoting some jobs below cost but I cannot tell which ones — how do I work it out?
Calculate your fully-loaded hourly cost and compare it to what you actually billed per hour on the last ten jobs, including travel and the time spent quoting. Most sole traders and small contractors discover their real cost is 1.3 to 1.5 times the bare wage once vehicle, insurance, tools, unbilled travel and non-billable hours are included — and that jobs quoted as a fixed price routinely land below it once the overruns are counted.
How do I make a window cleaning round more profitable without adding more houses?
Density beats volume. A round where the houses are close together earns far more per day than a bigger round spread across a wider area, because driving time is unpaid and it is usually the largest single cost after labour. Drop or reprice the outliers — the customers who require a fifteen-minute drive for one £12 clean — and the same working day fits more paid work.
My gardening and landscaping business is flat out all summer but I have nothing to show for it — why?
Two causes, and it is usually both. Green waste disposal has risen sharply and most maintenance rounds were priced before it did, so every visit now carries a cost that is not in the price. And the gardens themselves have grown — a round priced four years ago is servicing materially more plant than it was quoted for, at the same visit rate.
I run a 3-chair salon and rent is 18% of revenue — is that too high?
Yes, 18% is high — many salons run occupancy at roughly 8–12% of revenue — but the fix is usually revenue per chair, not a cheaper lease. At £3,600 a month rent on £20,000 of revenue, you need £30,000 a month to reach 12% without moving premises. Renting one chair out at £200 a week brings in about £866 a month and takes net rent to roughly 13.7% of current revenue straight away.
My plumbing business does $600k a year but I only take home $60k — where is the money going?
Usually into gross margin, not overhead. $60k on $600k is 10%. If materials and field labour take 52% of revenue, you keep 48% ($288,000) to cover roughly $228,000 of vans, office, insurance and marketing, which leaves $60,000. Every point of gross margin is worth $6,000 a year, so moving from 48% to 55% is $42,000 more to you on the same revenue.
What margin should a small café make on a cup of coffee?
Beans, milk and cup typically cost 20–25% of the price before VAT, so gross margin is around 75–80%. A £3.40 latte is £2.83 after 20% VAT and costs about £0.72 to make, a 75% gross margin. After barista time at an average 15 drinks per paid hour, about £1.18 is left per cup — 42% of the net price — before rent, energy and waste.
Recurring revenue and plans
Turning one-off jobs into money that arrives every month.
How do I add monthly recurring revenue to a trade business that only ever bills by the job?
Sell a maintenance or priority-response plan to the customers already in your database, not to new ones. A typical plan runs £15–£35 a month in the UK or $19–$40 in the US, and realistic take-up on a warm past-customer list is 10–20%. A trade with 400 past customers converting 15% at £25 a month is £1,500 a month of recurring revenue from work you have already done and people who already trust you.
Should my HVAC company offer maintenance plans, and what should I charge for them?
Yes. A common structure is $15–$25 a month for two tune-ups a year (cooling in spring, heating in autumn), priority scheduling and 10–15% off repairs. At $20 a month, 144 members out of a 1,200-customer list is $34,560 a year, against roughly $23,040 in visit costs, and the visits land in shoulder months when technicians would otherwise be quiet.
How do I price a monthly retainer for my web design business?
Price it so it clears your hourly rate even if every client uses their full allowance. At $100 an hour, a care plan with hosting, updates, backups and up to an hour of edits needs to be about $175 a month: $175 minus about $25 of hosting and licences, over 1.5 hours of work, is $100 an hour. Twelve clients is $2,100 a month, $25,200 a year.
Should my pest control company move customers from one-off treatments to recurring quarterly plans?
Yes. A one-off general treatment at $225 is often the only money that customer ever spends with you. A plan at $150 for the initial service and $60 a quarter is $330 in year one and $240 a year after. At an assumed 80% annual retention, that is about $676 over three years per plan customer, and 300 plan customers is $72,000 a year of recurring revenue.
Bookings, frequency and no-shows
Revenue lost to gaps, drift and empty slots rather than price.
How do I make more money from my dog grooming business without taking on more dogs?
Work on booking frequency before price. Most grooming salons lose more money to clients stretching from six weeks to nine than to underpricing — a client at six-week intervals is nine grooms a year, at nine weeks it is under six, which is a 35% revenue drop from the same customer. Rebooking at the till, before they leave, is worth more than a price rise and costs nothing.
How do I stop no-shows at my massage practice without losing clients?
Take a card at booking, send a reminder 48 and 24 hours ahead, and charge 50% for cancellations inside 24 hours with one forgiven per client per year. At 30 sessions a week and $95 a session, an 8% no-show and late-cancel rate costs about $10,900 a year; getting it to 2.5% recovers roughly $7,500 of that.
How much deposit should a photography business take to hold a date?
Take 25–50% as a non-refundable booking retainer, with the balance due 14–30 days before the shoot. On a $3,200 wedding, a 30% retainer is $960. A photographer shooting 25 weddings a year who has two cancel keeps $1,920 with a retainer and nothing without one — and loses dates that are hard to rebook in peak season.
How much revenue is my dental practice losing from patients who miss their hygiene recall?
Count it from your own book: active patients on a six-month recall should produce two hygiene visits each a year. A practice with 2,000 active patients should see 4,000 visits; at 2,800, the 1,200-visit gap at an assumed $150 each is $180,000 a year, before the restorative work those visits would have found. Pre-booking the next visit before the patient leaves is the main fix.
How much is my physiotherapy clinic losing when patients stop coming before their treatment plan is finished?
Measure average visits per new patient against the plan you recommend. A clinic with 40 new patients a month, prescribing six sessions at £60 but averaging 3.2 visits, earns £7,680 a month from them. Lifting the average to 4.5 visits is £10,800 — £3,120 a month, £37,440 a year — from patients who are already booked in.
Hiring, marketing and capacity
When spending on people or ads actually pays back.
Should I focus on getting more customers or making more from the ones I already have?
Almost always the customers you already have, because there is no acquisition cost and no delay. A 10% price rise across an existing book lands next month at effectively zero cost; winning 10% more customers requires marketing spend, sales time and typically two to three months before the first invoice. For a business under about twenty people, the existing book is nearly always the larger and faster opportunity.
Is it worth hiring my first employee when my house cleaning business does $120k a year on my own?
Yes, if you are turning work away. $120k at $65 an hour is about 1,846 billable hours, so you are full. An employee at $20 an hour, about $24 fully loaded, paid for 30 hours to bill 25 costs $720 a week and bills $1,625 — $905 a week of contribution, or roughly $41,600 over 46 weeks. They cover their own wages at about 11 billable hours a week.
Is Google Ads worth it for a local plumber when clicks cost $35 each?
Only if a click is worth more than $35 to you. The maximum you can pay is average ticket × gross margin × click-to-call rate × booking rate. For a $550 ticket at 50% margin, 15% of clicks calling and 60% of calls booking, that is $24.75 — so at $35 you lose about $10 per click on the first job, and the campaign only works if the average customer returns for a second one.
Should my barbershop rent chairs to barbers or pay them commission?
Commission earns more once a barber produces more than about $590 a week, but you carry the payroll, the supplies and the job of filling their chair. At 50% commission on $1,800 a week, the shop keeps about $768 after payroll tax and supplies; chair rent at $250 a week is $250 with far less risk. Rent suits barbers with their own following; commission suits a shop that brings the clients.
My yoga studio’s intro offer brings people in but hardly anyone converts to a membership — what should I change?
Change what happens inside the 30 days, not the offer itself. At 60 intro offers a month converting at 12%, you gain about 7 members; at 25%, 15. If a member pays $140 a month and stays an average of eight months, each is worth $1,120, so lifting conversion from 12% to 25% is worth about $8,700 per month of intro sign-ups.
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