How to improve profitability in SMEs? What we did to bring a service company back into profit

Many owners of service-based businesses ask themselves the same question: “Why aren’t we making a profit when revenues are growing?”That was exactly the challenge brought to us by a Polish SME. At first glance, everything looked healthy — stable sales, a steady flow of clients, and a fully utilised team. And yet, the financial result remained in the red.In this case study, we show what we uncovered after a detailed review of the company’s services, costs, and ways of working — and, most importantly, which actions allowed the business to return to profitability and rebuild its margins in just a few months.

Optymalizacja kosztów Symmetria Partners

Project goal

The objective of the project was to carry out a detailed review of which services provided by the company were profitable and which were generating losses, despite growing revenues and the apparent assumption that the business should be operating “in the black”.

The client approached us with a common SME challenge: increasing sales accompanied by a lack of profits. Our role was to identify hidden costs, inefficiencies in the allocation of work, and areas where the company was losing money without it being immediately visible. A key part of the analysis was determining at which stages of the process the largest losses occurred and why the financial results fell short of the business’s true potential.

The final goal was to deliver clear, practical recommendations that could be implemented in practice, enabling the company to restore profitability and bring structure and discipline to the way it operates.

Assumptions

  • The analysis covers all services offered by the company, including their full cost of delivery, without excluding hidden costs or expenses related to day-to-day operations.
  • Profitability is assessed based on team working time and the actual workload of individual roles, allowing us to capture the real impact of work organisation on financial results and to improve margins where possible.
  • We consider not only the margin of each individual service, but also its impact on the company’s overall operations, financial stability, and use of resources — all of which are critical for the profitability of a service-based business.
  • All recommendations are designed to be implementable in the short term, taking into account the company’s current capabilities, organisational structure, and available skills.
  • The goal is not only to identify areas that require change, but also to define a clear direction for future development: which services should be scaled, which need restructuring, and which create a greater burden than benefit for the business.

Actions taken

  • We carried out a full cost analysis covering the last two years to identify which expenses were truly affecting financial performance and where the company was losing money — a step that is often the starting point for improving profitability in SMEs.
  • We reviewed the scope of services delivered and compared it with what was actually invoiced. This revealed that many additional activities, such as travel to client sites or an extended scope of work, were not being charged for.
  • We then verified how much time the team was spending on these extra activities and assessed their impact on the margins of individual services.
  • A margin analysis was conducted for each service, showing that the largest and most resource-intensive work was in fact loss-making, while the overall result was being “rescued” by two smaller services that were offsetting those losses — a common issue in service businesses that do not analyse profitability at the service level.
  • Based on these findings, we identified areas requiring changes in ways of working, pricing, and service structuring, so the company could stop giving away value without compensation and start improving its overall profitability.

Effect

  • The company recorded a positive financial result for the first time in many months, driven by better cost control and the elimination of work delivered without compensation.
  • The largest service was redesigned and repriced to fully cover its cost, bringing an end to ongoing losses.
  • Clear rules were introduced around the scope of work and surcharges for additional elements, which improved margins across most services.
  • Management gained a transparent view of the profitability of each service, along with a clear plan enabling them to consciously scale the most profitable offerings and limit activities that were weighing down overall performance.

Duration

Full analysis and recommendations - 3 weeks

If your company is facing similar challenges – lack of profit despite high turnover, low margins or difficulty in assessing the profitability of services – we help SMEs manage costs, improve margins and get back in the black.

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