Margin Health Check
Are your margins as healthy as you think they should be, or would your growing business benefit from a margin review?
Do you feel like you’re not making as much money as you could be? Maybe something feels off, and you don’t quite trust the margins? Or maybe your turnover isn't materialising into profit?
Re-assessing the margin of the products and services your business offers can be one of those tasks that simply never gets done. Even with a large in-house team, they are often working at capacity on the day to day financial aspects of running the business and this is a project that is often overlooked.
However, once undertaken, it can have an almost immediate impact on your bottom line.
We don’t just look at the cost of sales and product, we also want to consider things like customer order value or basket size. What the volume of sales are on products with differing margins.
For example, are you selling multiple products that do the same function, but have different margins? Withdrawing one of those products could increase your profit.
At MWA Accounting, when we work with you on a margin health check project, we want to look at every element of the product consumer journey and make sure we are helping to obtain and maintain the best margin for each product or service you supply.
Our Strategic Advisory Services
Virtual Finance Department
- A dedicated point of contact in MWA Accounting on hand to give advice and answer queries
- Providing a variety of services from forecasting to advising on business structures
Cashflow & Profitability Planning
- Cashflow planning for business owners
- Planning, budgeting & forecasting
Exit & Succession Planning
- Clarifying reasons and goals for a business exit plan
- Creating a tangible exit plan
Margin Health Check
- Reassessing the margins of products and services
- Identifying "leaks", removing and restructuring
- Improve decision making around growth and increase margins
Vision Days
- Defining your business vision
- Identifying areas of weakness
- Creating a tangible business plan going forward
Who we work with
Sellers shipping internationally
Sellers scaling from UK to EU and US
Digital Product Creators
£500k to £5M+ Businesses
Case Studies
MWA supports to maximise margins
"We recently completed a margin health check for a client in the food and beverage industry. The owner felt they needed a better understanding of their costs, margins and price that hadn’t changed for a number of years.
Based on their P&L, we suspected there were some margin leaks and the client initiated a full Margin Health check. During this process, we identified that the best-selling dish that had a poor margin and the second best seller was actually loss-making.
With MWA’s help, the business now has a positive margin on all products and a strategy to ensure consistent promotion aimed at maximising margin. This supported their expansion plans and allowed their business to grow in a stress free and sustainable way. "
MWA clarifies data to achieve better profits
“Despite working hard, an e-com business owner wasn’t seeing the profit that they felt they should have been.
After engaging MWA to undertake a Margin Health check, it became apparent that through a combination of not integrating directly with their sales platforms and misclassifying some costs, the business owner and their previous accountants hadn’t been considering all direct costs.
Once this had been identified, each SKU could be accurately costed, allowing the owner to both increase prices and change suppliers to achieve the SKU margins, accounting profit and cash balances that they wanted."
FAQs
Most businesses experience hidden margin leaks, and we have several decades of experience assisting business owners and their management team to establish just where those leaks are.
Some examples could include a business that provides services and has clients of differing profitability, and one or two are impacting the whole margin.
In a business selling a product, it could be down to the mix of products, how they perform alongside each other and whether the cost of sale is unusually high for example, online cost per click advertising. The reality is that most businesses don’t have time to do the detailed analysis, but after a few conversations point us in the right direction in order to achieve impactful results quickly.
We will identify underperforming products/services. Remove or restructure low profit work. Improve decision making around growth and increase margins.
Many businesses benefit from conducting a margin review annually or when significant changes occur, such as new products, increased costs, or changes in market conditions. Regular reviews ensure profitability remains aligned with business goals.
Yes. A detailed margin review can highlight products or services that generate low or negative margins. This insight allows business owners to adjust pricing, reduce costs, or refocus on more profitable offerings.
As businesses grow, costs and operational complexity often increase. Margin analysis helps ensure growth remains profitable by monitoring cost structures and maintaining healthy profit margins.
By regularly reviewing margins, businesses can maintain profitability, adapt to market changes, and make data-driven decisions. Financial advisors often integrate margin analysis with broader financial planning to support sustainable growth.
Business owners often benefit from a margin review when profits are declining, costs are increasing, or they want to improve financial performance. Professional analysis can provide clarity and identify practical steps to strengthen margins.
What does an MWA Accounting margin health check include?
First of all, we spend some time with you getting an understanding of the products or services you offer and then tailor the service to your business.
How we achieve the best results for you depends hugely on what type of products and services you offer and how you attract business.
Things that we look at are;
- Gross margin analysis by service/product
- Client/customer pricing strategy and profitability review
- Pricing Structure
- Direct Cost Analysis
- Labour cost absorption review
- Overhead allocation review
- Break even analysis
- Competitor analysis
- Acquisition costs by product or service
"extremely friendly, approachable, and give clear advice. The team are highly efficient and go the extra mile for me and those that work with me. Whenever I have a query Richard is always on the end of the line to assist. I would highly recommend MWA to any other company looking for a reliable accountancy practice..."
Alex, Managing Director, UK Expert Medical
"...inputs and response times are fantastic ... advice has been timely, professional and commercial both in dealings with us and other professional advisers... it’s unusual to find an accountant in practice who speaks in plain English and is so commercially-minded, which is exactly what we have in MWA.”
Andy Scott, Chairman, REL Capital
"...great service from MWA Accounting every time, really pleased we switched across to them and they've really helped us out as a company over the last couple of years, always offering great advice, would certainly recommend."
Josh Ainsley, Managing Director, Ainsley Signs
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