Profitability tool

Where is my profit actually leaking?

Five numbers off your P&L, compared against the operating band for a business your size. It prices every gap in cash and shows what closing it is worth when you sell — and it will not count under-spending on marketing as profit found, because that is next year's revenue, not savings.

Last twelve months

Accounting basis

Annual revenue$Cost of goods sold$Materials, field labor and burden, subcontractors — everything that only happens because the job happened.Marketing spend$Media, agency, brand, and the fully-loaded cost of anyone whose job is to generate calls.Overhead$Rent, admin and office salaries, insurance, trucks, software, interest — everything that happens whether or not the phone rings.

Your seat

Your total compensation$Salary plus distributions plus anything the business pays that is really yours.Cost to replace you$What you would have to pay a general manager to do what you do. Only the amount you take ABOVE this is a real add-back — the rest is a genuine cost of running the business.

Against the band for $3M – $8M

Gross margin45.0%

3.0 pts belowTarget 48–54%

Marketing7.0%

In bandTarget 6–9%

Overhead30.0%

In bandTarget 27.5–32.5%

Net margin8.0%

4.5 pts belowTarget 12.5–17.5%

Before normalizing your own compensation — the line as your P&L reports it.

Adjusted EBITDA

Operating profit$640,000

Owner comp add-back$150,000Only the amount above the cost of replacing you.

Adjusted EBITDA$790,000

Profit left on the table

Cost of delivery3.0 pts below the floor$240,000

Annual, at today's revenue$240,000

Over three years, holding revenue flat: $720,000. Undiscounted — this is cash timing, not a present value.

What it's worth when you sell

Recovered margin is permanent, so a buyer capitalizes it. The same $240,000 of annual profit is worth this much in enterprise value:

5×$1.2M$1M–$5M revenue

7×$1.7M$5M–$15M revenue

10×$2.4M$15M+ platforms

Bands are directional operating targets for trades and home services businesses between $3M and $20M in revenue — not audited industry statistics, and not a substitute for your accountant. Multiples shown are typical acquisition ranges by business size; the multiple any individual business achieves depends on recurring revenue, owner dependence, customer concentration and market. Nothing you type here is sent to us, stored, or logged.

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