"I'm Busy, So Why Isn't My Business Profitable?" – A Guide for West Sussex SMEs

The phone is ringing off the hook, your diary is booked for weeks, and you’re working flat out. By all accounts, your West Sussex business is a success. You’re busy, your customers are happy, and revenue is coming in.
But then you look at your bank account, and the numbers don’t seem to reflect the effort. After paying suppliers, staff, and the taxman, there’s surprisingly little left for you or to reinvest in the business.
If this sounds familiar, you’re not alone. It’s the classic “busy but broke” paradox, a frustrating situation we see time and again with hardworking business owners across Crawley, Horsham, and the wider area.
The truth is, being busy isn’t the same as being profitable. This guide will help you understand the difference and uncover the five most common “profit leaks” that could be draining your business without you even realising it.
The Golden Rule: Revenue is Vanity, Profit is Sanity
Before we dive in, let’s clarify the most important distinction in business finance.
- Revenue (or Turnover) is the total amount of money your business generates from sales. It’s the big, impressive number that’s exciting to talk about.
- Profit is the money you have left after all your business expenses have been paid. This is the number that truly matters.
Think of your business as a bucket. The revenue is the water pouring in, but every business has holes in its bucket. Profit is the water that’s still left at the end of the day. A high turnover with big holes still leaves you with an empty bucket.
The 5 Most Common Profit Leaks (And How to Fix Them)
If your business feels like a leaky bucket, the cause is almost always one of these five issues.
1. Your Pricing Strategy is Wrong
Many small business owners, especially in a competitive market like West Sussex, set their prices based on what competitors are charging. This is a dangerous game. Your pricing must be based on your own costs and desired profit margin.
The Leak: You haven't factored in all your costs. You remember the cost of materials, but what about your time, your van’s running costs, insurance, software subscriptions, and the portion of your bills that needs to go to HMRC?
How to Fix It: Calculate your true "break-even" point for every job or product. This is the price at which you cover all direct and indirect costs. Only then can you add a healthy profit margin on top. Don’t be afraid to be more expensive than your competitors if your service and quality justify it.
2. Your Gross Margin is Too Thin
This is directly linked to pricing. Your Gross Profit Margin is the percentage of revenue left after paying for the direct costs of providing your goods or services (known as Cost of Goods Sold, or CoGS).
The Leak: A Crawley-based café might be selling lots of flat whites, but if the cost of the artisan coffee beans, organic milk, and designer cups is too high, the profit on each sale could be pennies. You’re working hard for very little return.
How to Fix It: Track your Gross Profit Margin obsessively, both for the business as a whole and for individual product or service lines. This will show you which offerings are your profit-makers and which are barely washing their face. You may need to renegotiate with suppliers, adjust your recipes or processes, or increase your prices on low-margin items.
3. Your Overheads Are Bloated
Overheads are the fixed costs you have to pay every month just to keep the lights on, regardless of how many sales you make.
The Leak: These costs can creep up over time without you noticing. That software subscription you never use, the oversized office space for your hybrid team, or inefficient utility contracts can silently drain your profits every single month.
How to Fix It: Conduct a full review of your overheads every quarter. Go through your bank statements line by line and ask: "Is this expense absolutely essential? Is it delivering a return on investment?" You’ll often find easy savings that go straight to your bottom line.
4. You're Giving Away Too Much (Discounting & Scope Creep)
To win a job or keep a client happy, it can be tempting to offer a discount or throw in a "little extra" for free. Done strategically, this is fine. Done habitually, it’s a disaster for profitability.
The Leak: For service-based businesses in particular, "scope creep" is a major profit killer. This is where a project slowly expands beyond the original agreement, and you end up doing hours of extra work for no extra pay.
How to Fix It: Be disciplined with discounts. Have clear, written proposals and contracts that define exactly what is included in the price. If a client asks for more, politely point to the original scope and explain that the extra work will require a revised quote.
5. You're Not Tracking Your Numbers Properly
This is the ultimate profit leak because it makes it impossible to spot any of the others. Running a business without accurate, up-to-date financial data is like trying to navigate from Crawley to Brighton without a map or road signs.
The Leak: You only look at your finances once a year when your accountant asks for your records. You have no idea what your monthly profit margins, overhead costs, or break-even point are.
How to Fix It: This is non-negotiable. You must have a robust bookkeeping system (we recommend Xero or QuickBooks) and you must review your key numbers at least once a month. A monthly Profit & Loss statement will give you the clarity you need to make smart, profitable decisions.
Real-World Example: A Horsham Marketing Agency
Let’s look at Ben. His marketing agency in Horsham is incredibly busy. Revenue has grown by 30% in the last year, but he feels more stressed than ever, and his personal drawings from the business haven’t increased.
With our help, he analyses his client list and profitability per project. The numbers reveal a shocking truth: his oldest and largest client, while providing consistent revenue, is actually his least profitable. Due to years of scope creep and being on a legacy rate, his team is spending double the amount of time on this client compared to others, for a fraction of the margin.
The solution: Ben has an honest conversation with the client, presenting the data. They agree to a revised contract with a 25% price increase and a much tighter scope.
The result: The agency’s overall profit margin increases by 10% in the next quarter, and his team is less stressed, freeing them up to serve other, more profitable clients.
Take Control of Your Profitability
Being busy is not a badge of honour if it isn’t building a sustainable and profitable business. True success comes from understanding the financial engine of your company.
- Know your break-even point for every job.
- Review your pricing at least once a year.
- Track your Gross and Net profit margins every single month.
- Conduct a quarterly review of all your overheads.
- Talk to your accountant about what the numbers are really telling you.
If you're a business owner in Crawley, Horsham, or anywhere in West Sussex who is tired of working hard for little reward, we're here to help. Let's have a friendly, no-obligation chat about your business.
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