# Example: Professional Services — Marketing Consultant

**Business:** Solo marketing consultant, project-based engagements
**Connectors:** QuickBooks (invoices + expenses), PayPal (payment collection)
**Data:** 9 months of transactions

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## What the owner asked

"I feel like I'm working more but not making more money. Can you look at whether I'm charging enough for each of my services?"

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## Step 2: Scope clarification

Owner offers three service types:
- Brand strategy (fixed-fee, $2,500/project)
- Monthly retainer (ongoing, $1,200/month)
- Ad campaign management (% of spend, variable)

Metric priority: revenue per hour (she wants to know where her time is best spent).

Note: Revenue per hour requires the owner to provide estimated hours. Ask: "For each service type, roughly how many hours does a typical engagement take?"

Owner estimates:
- Brand strategy: ~20 hours
- Monthly retainer: ~8 hours/month
- Ad management: ~6 hours/month

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## Step 5: Unit economics output

| Service | Revenue (9 mo) | COGS* | Gross Profit | Margin % | Rev/Hour |
|---|---|---|---|---|---|
| Brand strategy | $17,500 (7 projects) | $1,400 (tools, contractors) | $16,100 | 92% | $125/hr |
| Retainer | $21,600 (20 months) | $900 (tools) | $20,700 | 96% | $150/hr |
| Ad management | $14,200 | $600 | $13,600 | 96% | ~$118/hr |

*COGS here is direct expenses (software tools, occasional contractor help) — owner's own labor is excluded from COGS per accounting convention but captured in the Rev/Hour column.

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## Step 6: Benchmarking

"For professional services, gross margins of 60–80% are typical. Your margins are 92–96%, which reflects a low direct cost structure. The more meaningful question is revenue per hour: at $118–$150/hr, you're in a solid range for independent marketing consultants. However, if your effective hourly rate (after all business expenses, not just COGS) is lower, the picture changes. To get that number, divide your net income by total hours worked."

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## Step 7: Pricing scenarios — Brand Strategy (lowest revenue/hour)

Current rate: $2,500/project. Owner's estimate: 20 hours average.

| Scenario | New Rate | Est. Projects* | Revenue | Rev/Hour |
|---|---|---|---|---|
| +10% ($2,750) | $2,750 | ~6.5 (−7% vol) | $17,875 | $138/hr |
| +20% ($3,000) | $3,000 | ~6 (−14% vol) | $18,000 | $150/hr |
| +30% ($3,250) | $3,250 | ~5.5 (−21% vol) | $17,875 | $159/hr |

*Volume estimates are rough — only 7 brand strategy projects in 9 months is a small sample. These numbers should be treated as directional, not precise.

"If the 9-month pattern holds, a 20–30% rate increase on brand strategy projects might generate similar or slightly higher revenue with fewer projects — freeing up hours you could use for retainers (your highest-margin service)."

Note: This surfaces data, not a recommendation. The owner decides.

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## Notes for skill author

- Service businesses often have near-100% gross margins on paper because they have minimal direct costs — the meaningful metric is revenue per hour or revenue per engagement
- Always ask for estimated hours before computing Rev/Hour; don't assume
- With only 7 brand strategy projects in 9 months, the sample is small — call that out explicitly
