​Please contact jkc consultancy if you want to discuss these issues, would like to learn more about what we do or if you have a specific issue we can help with.

Khlayre Cairney can be contacted on 07568 143929 or if you prefer please email on khlayre.cairney@jkcconsultancy.co.uk

​Understanding Profitability

​Understanding profitability is about knowing your income streams, cost of sales and cost to deliver on those sales. If you don't understand your cost to deliver you cannot place a value or cost on your goods or service. This will affect your income, and therefore your profit.​

At jkc consultancy, we believe a strong foundation based on the analysis of 3 key numbers - and this is about business 'as is'.

Income. Understanding this is crucial and, depending on your business, we will analyse in numerous ways; days of the month/week/day/hour, fee-earners, staff members, geographical areas, product, service, seasonality trends and so on. This will not only support profitability and decision-making, it will also validate target setting, projecting sales income and forecasting, all of which can be evidence-based.​

Cost of Sales/Delivery. This isn't just a financial transaction – the cost of buying good against the selling price. For most businesses this is inaccurate especially in bespoke service industries with numerous ‘hidden’ activities which are neither costed out and then added to the original cost of sales. Each and every previously hidden transaction needs to be allocated a £ value and added to the cost of sales. If businesses fail to accurately understand their cost of sales the will also fail to place an accurate price or value on their goods or service and consequently, their ‘perceived’ profit will also be inaccurate.

Overheads. These are fixed costs for the business and ensuring an accurate figure per year/month/week is key as these are business costs regardless of the business has customers or clients. Understanding overheads, both one-offs and reoccurring reinforces the importance of reviewing these costs as well as driving a clear message about lost opportunities.

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Investor Ready

​Approaching investors unprepared is probably the single biggest reasons why entrepreneurs fail to secure funding. One area that is key is understanding your profitability and the figures in your business plan. If you cannot demonstrate that you have a really firm understanding of your commercials it is likely that an investor will turn away.

At jkc consultancy we will help your understanding of business ‘as is' as this will give you a strong foundation. You should be able to articulate your business journey and explain how you arrived at each and every number. A strong foundation will be based on your income, cost of sales or delivery and overheads.

We can now move onto planning business ‘to be’. Our modelling tool delivers bespoke profitability scenarios which might financially impact on the business going forward. These include fluctuation in sales, costs of sales, impact of price increases or discounts (when all other costs remain the same), and the impact of overhead costs. It can also show the impact when two or three happen at the same time, in either direction (up or down).

There are multiple benefits to this but all come back to the same valid points; decisions can be evidence-based on data and therefore more accurately risk-assessed thus supporting sustainability and/or business change.

The evidence of data will: 

• Ensure your ability to discuss your financials with confidence when speaking with investors as there is clarity, evidence, data and due diligence.
• Ensure your commercials are defendable.
• Support decision-making - either by you the business owner or with your partners. 
• Give you a clearer understanding when external forces disrupt and drive change. 

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Business Health Checks

​Are you spending too much time 'in' your business and not enough time 'on' your business? This is a very common problem as we are all so close to our businesses. As part of jkc consultancy services we offer a business health-check which will support understanding of your profitability before assessing your next move.

​Our health checks are ideal if you are:

• A successful entrepreneur business owner.
• Striving to achieve next level growth in turnover and productivity.
• Frustrated by your lack of progress and poor performance of staff.
• Finding that your business is running you.
• Spending all your time working in your business and not on your business.
• Wanting to step back from or exit your business.
• ​Confused as to which 'unit' is most profitability.
• Need complete clarity as to where your income is coming from.
• Support decisions about changing premises, or take on new staff.
• Looking to secure finance to support the next phase of growth for your business.

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We are all about small incremental changes that make a difference. Sometimes it is not one thing but a series of three of four things that will make the difference to your and your bottom line. As Henry Ford said...

"Nothing is particularly hard if you divide it into small jobs."
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