{"id":1289,"date":"2026-06-01T13:07:09","date_gmt":"2026-06-23T12:00:12","guid":{"rendered":"https:\/\/www.bare-digital.com\/ashe\/revenue-margins-and-ratios-the-numbers-most-firms-never-get-taught\/"},"modified":"2026-07-30T16:38:27","modified_gmt":"2026-07-30T16:38:27","slug":"revenue-margins-and-ratios-the-numbers-most-firms-never-get-taught","status":"publish","type":"post","link":"https:\/\/www.bare-digital.com\/ashe\/revenue-margins-and-ratios-the-numbers-most-firms-never-get-taught\/","title":{"rendered":"Revenue, margins, and ratios: the numbers most firms never get taught"},"content":{"rendered":"<p>First things first, drop your shoulders, take a deep breath. <strong>You&#8217;re not behind<\/strong>, if you&#8217;re asking yourself these questions, you&#8217;re just missing a framework most of us were never taught.<\/p>\n<p>So on that note, it&#8217;s okay if you feel a bit exhausted whilst also confident that you <strong>should be earning more.<\/strong> Most firm owners I speak to don&#8217;t actually know whether their firm is <em>performing badly<\/em>, <strong>or<\/strong> whether they&#8217;re just exhausted.<\/p>\n<p>They know their team are busy, they know January nearly finished them off, they know money comes in&#8230; and goes straight back out again.<\/p>\n<p>But if I asked you a very simple question:<br \/><strong>&#8220;How much revenue should one person in your team be able to generate?&#8221; <\/strong>Could you answer it? <\/p>\n<p>For more people, the answer is probably not, not because you&#8217;re doing anything wrong but because nobody ever sat us down and explained this properly, so let&#8217;s do that.<\/p>\n<div>\n<hr>\n<\/div>\n<h3>The &#163;200 month that changed everything for me<\/h3>\n<p>Years ago, when striveX was still run from my dining room table, we hired someone new. They were brilliant, always busy, always doing something. At the end of the month, we ran the billing report and they&#8217;d generated <strong>&#163;200<\/strong>.<\/p>\n<p>Not &#163;2,000. Not &#163;20,000. &#163;200.<\/p>\n<p>What made my stomach drop wasn&#8217;t just the number.<\/p>\n<p>It was the realisation that:<\/p>\n<ul>\n<li>\n<p>they <em>had<\/em> been working<\/p>\n<\/li>\n<li>\n<p>we <em>hadn&#8217;t noticed<\/em><\/p>\n<\/li>\n<li>\n<p>and we had absolutely no way of knowing until it was too late<\/p>\n<\/li>\n<\/ul>\n<p>That moment became the catalyst for everything we now do around capacity, KPIs, and profitability. Because here&#8217;s the uncomfortable truth:<\/p>\n<blockquote>\n<p>Hard work does not automatically translate into healthy revenue.<\/p>\n<\/blockquote>\n<div>\n<hr>\n<\/div>\n<h3>This is not about squeezing people<\/h3>\n<p>Before we go any further, I need to be really clear. This conversation is <strong>not<\/strong> about:<\/p>\n<ul>\n<li>\n<p>pushing people harder<\/p>\n<\/li>\n<li>\n<p>turning accountants into machines<\/p>\n<\/li>\n<li>\n<p>chasing unrealistic targets<\/p>\n<\/li>\n<li>\n<p>or extracting maximum profit at all costs<\/p>\n<\/li>\n<\/ul>\n<p>Good revenue expectations are about: <strong>clarity, fairness, rhythm, and sustainability<\/strong>.<\/p>\n<p>They protect teams, they protect owners, and they stop firms running on vibes.<\/p>\n<div>\n<hr>\n<\/div>\n<h3>The industry reality (not the fantasy)<\/h3>\n<p>When we started building our model, we asked two questions:<\/p>\n<ol>\n<li>\n<p>What is realistically possible in <em>this industry<\/em>?<\/p>\n<\/li>\n<li>\n<p>What is realistically possible in <em>our firm<\/em>?<\/p>\n<\/li>\n<\/ol>\n<p>What we found is this:<\/p>\n<ul>\n<li>\n<p>Some highly automated, niche service providers (outsourced FD) or fully outsourced firms can hit <strong>60% profit margins<\/strong><\/p>\n<\/li>\n<li>\n<p>Most healthy, well-run firms sit around <strong>15&#8211;20%<\/strong><\/p>\n<\/li>\n<li>\n<p>The majority of <em>real<\/em> firms live somewhere in the middle<\/p>\n<\/li>\n<\/ul>\n<div>\n<hr>\n<\/div>\n<h3>The simplest rule most firms never get taught<\/h3>\n<p>Here it is, in plain English:<\/p>\n<blockquote>\n<p><strong>A chargeable team member should generate around 3x their salary in revenue.<\/strong><\/p>\n<\/blockquote>\n<p>That&#8217;s it.<\/p>\n<p>Not because it&#8217;s &#8220;nice&#8221; but because it&#8217;s how the maths works. Traditionally that breakdown comes from:<\/p>\n<ul>\n<li>\n<p>&#8531; salary<\/p>\n<\/li>\n<li>\n<p>&#8531; overhead<\/p>\n<\/li>\n<li>\n<p>&#8531; profit<\/p>\n<\/li>\n<\/ul>\n<p>So if someone earns &#163;40,000, the firm needs roughly <strong>&#163;120,000<\/strong> of revenue from that role per year.<\/p>\n<p>In well-systemised firms, with experienced people, good workflows, and stable clients, that multiple can move to <strong>4x<\/strong>. But 3x is where clarity starts.<\/p>\n<p>Any questions? lets chat &#128071;&#127996;<\/p>\n<div class=\"community-chat\" data-attrs=\"{&quot;url&quot;:&quot;https:\/\/open.substack.com\/pub\/practiceownerspod\/chat?utm_source=chat_embed&quot;,&quot;subdomain&quot;:&quot;practiceownerspod&quot;,&quot;pub&quot;:{&quot;id&quot;:2834513,&quot;name&quot;:&quot;The Practice Owners Podcast \u2122&quot;,&quot;author_name&quot;:&quot;Rachel Harris&quot;,&quot;author_photo_url&quot;:&quot;https:\/\/substackcdn.com\/image\/fetch\/$s_!6Q7F!,f_auto,q_auto:good,fl_progressive:steep\/https%3A%2F%2Fsubstack-post-media.s3.amazonaws.com%2Fpublic%2Fimages%2Fbfbd2260-fc1e-4411-a1f5-9c08ff53368c_800x800.png&quot;}}\" data-component-name=\"CommunityChatRenderPlaceholder\"><\/div>\n<div>\n<hr>\n<\/div>\n<h3>What this looks like in real teams<\/h3>\n<p>In our year-end and business services teams:<\/p>\n<ul>\n<li>\n<p>Part-qualified and qualified accountants are expected to generate <strong>&#163;10,000+ per month<\/strong><\/p>\n<\/li>\n<li>\n<p>Portfolio managers (more ownership, more complexity) generate more, often <strong>3&#8211;4x salary<\/strong><\/p>\n<\/li>\n<li>\n<p>Managers <strong>do not bill at all<\/strong><\/p>\n<\/li>\n<\/ul>\n<p>That last one always causes a reaction.<\/p>\n<p>Our managers don&#8217;t hold portfolios, they don&#8217;t bill time, their job is leadership. Their KPI is one question:<br \/><strong>&#8220;Is my team consistently hitting their KPIs?&#8221; <\/strong>That shift alone changed everything for us.<\/p>\n<div>\n<hr>\n<\/div>\n<h3>Why margins feel &#8220;impossible&#8221; for so many firms<\/h3>\n<p>If your team is flat out but margins are awful, it&#8217;s usually not because the team aren&#8217;t doing anything. It&#8217;s because:<\/p>\n<ul>\n<li>\n<p>pricing doesn&#8217;t reflect reality<\/p>\n<\/li>\n<li>\n<p>too much admin sits with chargeable staff<\/p>\n<\/li>\n<li>\n<p>managers are stuck in the weeds<\/p>\n<\/li>\n<li>\n<p>capacity has never been properly modelled<\/p>\n<\/li>\n<li>\n<p>or the firm is emotionally attached to being &#8220;busy&#8221;<\/p>\n<\/li>\n<\/ul>\n<p>Without revenue expectations, you&#8217;re guessing. With them, you suddenly know:<\/p>\n<ul>\n<li>\n<p>whether you&#8217;re undercharging<\/p>\n<\/li>\n<li>\n<p>whether you&#8217;re overstaffed<\/p>\n<\/li>\n<li>\n<p>whether systems are slowing everything down<\/p>\n<\/li>\n<li>\n<p>whether a role is viable at all<\/p>\n<\/li>\n<\/ul>\n<p>This is why gut feel is dangerous.<\/p>\n<div>\n<hr>\n<\/div>\n<h3>The ratio that kept us sane<\/h3>\n<p>Most firms aim for <strong>3 chargeable : 1 non-chargeable<\/strong> ratio on team members. As we scaled quickly, ours became <strong>2 : 1<\/strong>. That non-chargeable role evolved over time: the first hire was admin, then client coordination, then marketing then business development, then our own internal FD. That internal team is now the heartbeat of the firm. It&#8217;s the reason our accountants can actually do chargeable work, and go home on time.<\/p>\n<div>\n<hr>\n<\/div>\n<h3>This is about security, not greed<\/h3>\n<p>One of the biggest myths in our profession is that talking about profitability is somehow distasteful or about getting the most out of every team member, every second of the day. But here&#8217;s what teams actually want:<\/p>\n<ul>\n<li>\n<p>job security<\/p>\n<\/li>\n<li>\n<p>stability<\/p>\n<\/li>\n<li>\n<p>confidence the firm will survive<\/p>\n<\/li>\n<\/ul>\n<p>Profitability gives you that and when people understand the numbers, they stop feeling personally blamed for structural problems.<\/p>\n<div>\n<hr>\n<\/div>\n<h3>If you take one thing from this<\/h3>\n<p>Please take this:<\/p>\n<blockquote>\n<p><strong>Margins are not the reward for suffering.<br \/>They are the result of clarity.<\/strong><\/p>\n<\/blockquote>\n<p>If January nearly broke you, that doesn&#8217;t mean you&#8217;re weak, it means your firm is asking questions your systems can&#8217;t answer yet. And those questions are solvable.<\/p>\n<div>\n<hr>\n<\/div>\n<h3>If you want to go deeper<\/h3>\n<p>if you want this unpacked slowly, honestly, and with real context, this is exactly the work we do inside the <strong>Practice Owners Podcast<\/strong>.<\/p>\n<p>With weekly episodes on these topics, monthly integration sessions to get your questions asked live, special discounts and an incredible community:<\/p>\n<p class=\"button-wrapper\" data-attrs=\"{&quot;url&quot;:&quot;https:\/\/practiceownerspod.substack.com\/subscribe?&quot;,&quot;text&quot;:&quot;Subscribe now&quot;,&quot;action&quot;:null,&quot;class&quot;:null}\" data-component-name=\"ButtonCreateButton\"><a class=\"button primary\" href=\"https:\/\/practiceownerspod.substack.com\/subscribe?\" target=\"_blank\" rel=\"noopener\"><span>Subscribe now<\/span><\/a><\/p>\n<p>You&#8217;re not behind, you&#8217;re just missing a framework most of us were never taught.<\/p>\n<p>Rachel &#129782;&#127995;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>First things first, drop your shoulders, take a deep breath. You&#8217;re not behind, if you&#8217;re asking yourself these questions, you&#8217;re just missing a framework most of us were never taught. So on that note, it&#8217;s okay if you feel a bit exhausted whilst also confident that you should be earning more. Most firm owners I [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":3074,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_eb_attr":"","_templately_pack_id":"","_templately_imported_at":"","_templately_source":"","_templately_import_session_id":"","footnotes":""},"categories":[13,1],"tags":[],"class_list":["post-1289","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-people","category-podcast"],"acf":[],"_links":{"self":[{"href":"https:\/\/www.bare-digital.com\/ashe\/wp-json\/wp\/v2\/posts\/1289","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.bare-digital.com\/ashe\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.bare-digital.com\/ashe\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.bare-digital.com\/ashe\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.bare-digital.com\/ashe\/wp-json\/wp\/v2\/comments?post=1289"}],"version-history":[{"count":1,"href":"https:\/\/www.bare-digital.com\/ashe\/wp-json\/wp\/v2\/posts\/1289\/revisions"}],"predecessor-version":[{"id":1330,"href":"https:\/\/www.bare-digital.com\/ashe\/wp-json\/wp\/v2\/posts\/1289\/revisions\/1330"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.bare-digital.com\/ashe\/wp-json\/wp\/v2\/media\/3074"}],"wp:attachment":[{"href":"https:\/\/www.bare-digital.com\/ashe\/wp-json\/wp\/v2\/media?parent=1289"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.bare-digital.com\/ashe\/wp-json\/wp\/v2\/categories?post=1289"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.bare-digital.com\/ashe\/wp-json\/wp\/v2\/tags?post=1289"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}