Are Your Busiest Days Secretly Costing You Money? A Guide to True Profitability.

I had a HVAC contractor on Westheimer pull $140,000 in revenue last October. His crew was running six days a week, emergency calls on top of scheduled jobs, the whole operation maxed out. When we closed the books that month, he’d made $3,400 profit. That’s 2.4% on the top line. He asked me where it all went.

Turned out he was chasing high-volume residential calls at $185 a pop while ignoring the commercial maintenance contracts worth $2,800 per month that barely got any marketing attention.

Busy Is Not the Same as Profitable

I see this every single quarter with Houston small business owners. They confuse activity with profit. More jobs feel like success. More calls feel like growth. But the spreadsheet tells a different story.

Last year I worked with three different service businesses. All three had record booking months. Two of them actually lost money doing it. The third made $14,200 that same month on half the volume.

The Popular Service You’re Losing Money On

A cleaning outfit in Midtown was running a $99 deep-clean special that got hammered on Groupon. Client base was huge. Every day booked solid. Then we sat down and mapped the actual cost. Labor came to $82 per job. Supplies ran another $15. Drive time between houses averaged 35 minutes. Real cost landed at $104 per job.

They were losing $5 on every booking. And because the deal went viral on social media, they had more revenue and less money in the bank.

Your Markup Is Lying to You

Most owners use the same percentage markup across every service they offer. 30% here, 30% there. Simple math. The problem is your costs aren’t uniform. A two-hour job and a 10-hour job shouldn’t carry the same percentage if you want to make money on both.

I had a general contractor in the Galleria area doing the same thing. He marked up labor at 50% on everything. A tile floor took 12 hours of labor and ran thin. A full bathroom remodel took 40 hours of labor but needed careful project management, scheduling coordination with other trades, and significant rework costs. Same 50% bump applied to both. The bathroom work was bleeding cash.

Competitors’ Pricing Isn’t Your Pricing

You know what I hear all the time? “Well, Bob down the street charges $150 for this, so that’s what I charge.” You have zero idea if Bob is profitable. I’ve seen plenty of Houston business owners “matching the market” straight into bankruptcy. That guy might be:

Doing the work himself to avoid labor costs. Operating in a different neighborhood with different overhead. Planning to raise prices next quarter because he’s figured out he’s losing money. Subsidizing cheap work with higher-margin stuff you don’t know about. Just wrong about his own profitability.

Price your work on what it actually costs you plus the margin you need to run a real business. Not on guessing what somebody else is doing.

Finding Your Actual Profit Engines

Here’s what I’ve found after handling books for hundreds of Houston businesses: almost always, 20-30% of your service offerings generate 70-80% of your actual profit. The rest break even or lose money. Most owners have no idea which is which.

We run something called service-level profitability analysis. You take each service or product line separately and calculate what it really costs to deliver. Then you run the actual numbers. The picture changes fast.

First, real cost accounting. Not just materials and labor. Drive time, fuel, equipment wear, the office overhead split across that job, customer acquisition cost for that type of client, warranty callbacks, the admin time to schedule and invoice. Everything.

Second, you map actual profit by service. Clients are almost always shocked. Their “bread and butter” offering makes 8% while something they barely advertise makes 42%. They find services that aren’t losing money, they’re hemorrhaging it. They find services they haven’t priced in years.

Third, you make actual decisions. You raise prices on the low-margin work or you stop doing it. You market the profitable stuff and cut the losing stuff. You stop spending ad dollars trying to book more of work that doesn’t pay.

One Client’s Real Example

A wellness practice in the Med Center was offering 14 different services. Massage therapy, acupuncture, nutrition coaching, energy work, the full menu. They thought they were diversified. They were just scattered.

We ran profitability by service. Five of those 14 were money losers. Two of the five were booking clients almost every day. They were scaling their losses.

We cut two services entirely. Raised prices on another. Moved all their Google Ads budget to the four services actually making money. Within five months, their total appointments dropped 18%. Their profit went up $51,000.

That’s the real math. Fewer jobs. Significantly more money. That’s the business you actually want to run.

The One Question That Matters

Most business owners I sit down with can’t answer this without checking their QuickBooks: Which of your services makes the most money per hour your team spends on it?

If you’re guessing, you’re subsidizing your worst work with profits from your best work. You’re spending marketing money on services that shouldn’t exist. You’re running exhausted because you’re chasing revenue instead of profit.

I’d rather work with someone doing $80,000 a month on five profitable service lines than someone doing $200,000 on 15 scattered offerings that cancel each other out.

Want to know which of your services is actually making money? Schedule a free Profitability Review with EZQ Group. We’ll pull your books apart service by service and show you exactly where your profit lives, where it’s leaking, and what to do about it.