7 Ways to Have a Profitable and Productive 2025
By Ruth King
You start over on January 1, 2025.
It doesn’t matter whether 2024 was a good or a bad year from a business profitability perspective. You start over on January 1, 2025. The past is the past and you can do nothing about it except learn from painful lessons, if there were any. Here are seven ways to keep busy and profitable throughout 2025.
1. If your financial statements are not accurate —resolve to make them accurate.
Garbage in equals garbage out. I’ve made it easy to review accurate financial statements at www.financiallyfit.business.
2. Grow your profitable maintenance program.
Your maintenance clients trust you and will use your company in good times and bad times. They provide stability, less seasonality and more consistent cash flow.
Here’s an easy way to discover how many residential maintenance plans you should have: Divide the number of non-maintenance customers you’ve done business with in the past 5 years by 3. That’s the minimum number of residential maintenance plans you should have.
From a commercial perspective, calculate maintenance hours rather than numbers since some plans can have 20 systems and others only one. If you have 3 commercial technicians, you should have 1800 hours of commercial maintenance.
3. Ask your employees how to save $100 per month.
If you ask an employee how to save $10,000 per year, they can’t grasp that large amount. However, if you ask them to identify with a number they can relate to, i.e. $100 per month, they can probably come up with an idea or two. Implement the ideas and give them a $100 bonus for coming up with that idea.
4. Calculate your company’s billable hours percentage.
If you don’t like the percentage, resolve to increase it in 2025. We generate revenue through billable hours. If you can’t bill a customer for a field employee’s time — you don’t generate revenue. If one of your team members puts 40 hours on his/her time sheet — how many of those hours were billable?
• Service — at least 60% and preferably 75% or higher.
• Replacement — at least 85% and preferably 90% or higher.
If you’d like a template to calculate billable hours, email me at rking@ontheribbon.com or call us at 770-729-8000.
5. Calculate your company’s net profit per hour.
If you don’t like the number, resolve to increase it in 2025.
Net profit per hour is calculated on billable hours or revenue producing hours. Divide 2024 net operating profit by the total number of billable or revenue producing hours.
If you lost money in 2024, you paid your customers to do their work. Not exactly what you want to plan for 2025.
Increasing net profit per hour can be as simple as decreasing the number of unbillable hours. The best way to do this is to track it — put a chart on the wall with each employee’s name and the number of paid hours and the number of billable hours. Since the hours are being watched, the unbillable hours will decrease quickly.
6. Watch overtime hours.
Overtime is expensive. This might seem like a ludicrous statement give what I’ve just talked about with respect to billable hours percentage.
Overtime should be at a minimum — and to many of your employees overtime is punishment…they don’t want it.
What about the office personnel? Are they consistently getting one to two hours per week or more overtime — in busy times and slow times? If you pay an office person $16 per hour, the overtime is $8 per hour or $416 per year. Then you must add payroll taxes and worker’s comp to this cost which is about 15% so the real cost comes to $478.40.
That doesn’t seem like a lot until you calculate the revenues you need to generate to pay that one hour of overtime. Let’s assume that you want to generate a 10% net operating profit. The revenue you have to generate to cover that one hour of overtime is $4,784!
Overtime is expensive!
7. Save money.
At a minimum save 1% of every dollar that comes in the door.
This is advice I’ve given for a long time. Frequently I get emails or phone calls from contractors who say thank you for this idea. They have hundreds of thousands of dollars in interest bearing accounts. They have the money to pay for trucks, computers, equipment and other assets that, in the past, required bank loans. The revenues in the bank give you a sense of security that if cash flow gets tight, you have the ability to survive.
Implementing these seven ideas in 2025 will help you increase your bottom line.

Ruth King is a management consultant and trainer to the plumbing and HVAC industry. To purchase Ruth’s new book, The Courage to be Profitable, visit ruthkinghvac.com.
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