The 5 Numbers That Will Make (or Break) Your Business

Revenue alone doesn’t tell you if you’re profitable

If you’re struggling to make sense of your business finances, you’re not alone. Most home service pros are working harder than ever—yet still feel broke, burned out, and unsure if they’re actually making money. In this session, Kelly Guerrero, founder of HomePro Coaching and former landscaping business owner, breaks down the five essential metrics every service business needs to track to become—and stay—profitable. Plus, she walks through her free downloadable Know Your Numbers worksheet to track your monthly performance.

In this Session

• [00:42.13] Understanding financial struggles in service businesses
• [02:09.15] The importance of key metrics for profitability
• [02:59.98] Debunking revenue myths
• [04:48.03] The impact of focusing on profitability
• [07:00.90] Gross profit margin: A critical metric
• [10:16.65] Adjusting pricing for profitability
• [12:03.41] Managing labor costs effectively
• [16:00.63] Improving your close rate
• [20:27.70] Understanding net profit
• [22:34.66] Strategies for improving profitability
• [24:52.92] Building a sustainable business model
• [27:22.06] Financial tracking cheat sheet
• [31:34.52] Analyzing business performance over time

Q&A

What’s the right balance between high gross margin and closing jobs?
If your close rate is too high (over 70%), you’re likely underpricing your services. Fear of losing clients when raising prices is real, but often unfounded, especially for recurring services. Start small: raise prices incrementally and communicate that rate increases are annual. In one example, only 2 out of 350 clients canceled after a price hike.

How should I raise prices without losing too many clients?
Raise prices for new clients first at the new, higher rate. Then gradually increase rates for existing clients by $10–$20/month. Never raise rates when service levels are low (e.g., during seasonal slowdowns like spring for lawn care). Wait until your team is delivering consistently strong service to justify increases.

What’s a reasonable percentage to raise rates by?
Between 10%–20% is generally acceptable, unless you’ve added more value to the service. If a client is high-maintenance or unprofitable, raising their rate may even encourage a natural parting of ways, which can reduce stress and improve overall profitability.

Should I include my own salary in labor costs?
Yes—if you’re actively working in the business (e.g., on-site or in admin roles), you should include your salary in labor costs. Pay yourself what you’d pay someone else to do that job. Separate this from your owner’s draw or profit, so your financials remain clear and scalable.

What’s the ideal close rate for jobs?
A close rate above 70% may suggest you’re underpricing. It’s better to lose a few price-sensitive clients and improve your gross margin than to be constantly busy but broke. High close rate + low profit = unsustainable.

What’s the one metric I should focus on if I’m new to all this?
All five metrics are critical and work together, but if you need a starting point. Start by tracking job profitability—your revenue per job minus costs. From there, understand how metrics like close rate and net profit interconnect. If you use Jobber, the job costing tools can help.

Any advice on managing cash flow in a seasonal business?
Implement a “profit-first” savings approach: set aside 10–15% of peak season revenue into savings. Aim to build at least two months of payroll coverage. When you focus on profitability year-round, you’ll find those dry spells due to seasonal demand aren’t as dry anymore.