Design agency case study

What was the problem?

Our client was a design agency which specialised in the design and build of retail premises, catering establishments and visitor attractions.

The owners felt that the company should be making more profit but had no idea how to figure out if and where there were any problems which would be reducing the profit.
The client wanted to know which clients and which jobs were profitable, and which not, but also how much of the profit was coming from fees and how much from production charges.

How we helped find a solution

We set about finding out which jobs were profitable, and which not, but also how much of the profit was coming from fees and how much from production charges.

We helped the client to set up a job costing system to integrate into their accounting software. We also helped them to get a timesheet reporting system in place for their staff and we set up monthly management reporting for them. Once the systems were in place we started to measure job performance and had regular monthly meetings to review the results to see where the business was performing profitably and where there were issues.

We also set up targets for the growth of the profitability rather than the growth of turnover and measured performance against those targets each month.

What was the outcome?

Our client quickly identified where the problem areas were. They were able to introduce better pricing, clearer communication with their customers about any modifications to designs and better efficiency on jobs by setting up processes for time saving.

The profitability increased by 50% in year 1 and 100% in year 2 so we had a very happy client.