CASE STUDY
Identifying Critical Financial Indicators
269% net profit increase
A closer look at the financial drivers affecting profitability helped one client identify major sources of profit drain, improve pricing decisions, and increase net profit by 269% in one year.
The challenge
A fast-growing client was bringing in more revenue, but net profit was moving in the wrong direction.
Leadership knew the business was not as profitable as it should be, but they did not have a clear view of where profit was being lost. They needed better reporting, better visibility into service line performance, and a more useful way to understand the financial impact of staffing, pricing, and project delivery.
What changed
Gemsbok worked with the company to identify the primary drivers of profitability.
Because the client operated as a service business, a significant portion of cost was tied to personnel, time, and the effectiveness of each service line. Gemsbok helped the company establish clearer financial reporting that gave leadership a more practical view of how the business was performing.
This included:
Service line reporting to evaluate the profitability of each service area
Utilization reporting to track employee time and effectiveness
Project and client-based reporting to compare profitable and unprofitable work
Revenue and cost analysis on a per-hour basis to identify trends over time
Once the company had a clearer baseline, Gemsbok helped leadership review monthly reports, track changes, and use the information to make more informed decisions.
Gemsbok trained the client’s team to use the new systems, established clear performance expectations, and stayed engaged until the reporting process was fully operational and the team could manage it confidently on their own.
The outcome
The new reporting showed that the company was not charging enough to recover the cost of some of its more expensive service lines. It also created better visibility into staff performance and project efficiency.
With that information, leadership was able to adjust pricing, address staff inefficiencies, and make decisions based on clearer financial data.
Within one year, the company increased net profit by 269%.