Busy, Burnt Out, and Nothing in the Bank: The Pricing Problem Nobody Is Fixing

You can be fully booked. Working six days a week. Getting new clients every week from your marketing.

And still have nothing left in your bank account.

That is not a revenue problem. That is a pricing problem.
In this episode I am walking you through the exact step-by-step process inside the Profitable Pricing Calculator, the same tool I have used with over 400 business owners to help them stop running a business that looks successful on the outside while quietly falling apart behind the scenes.

With the national minimum wage up 4.75%, Payday Super now live, and EFTPOS surcharge fees no longer passable to consumers from October 2026, your profit is already shrinking if your prices have not moved.

→ Why most beauty business owners are charging prices they have no idea are profitable or sustainable
→ The three ways to increase profit and why two of them will not work if pricing is broken from the start
→ How to calculate your exact breakeven cost per hour, per minute, and per service
→ The 80% capacity rule and why basing prices on full bookings sets you up to undercharge
→ How to work out real product costs service by service rather than relying on BDM estimates
→ What the calculator shows you that your accountant and bookkeeper will not walk you through
→ How to factor in GST, EFTPOS surcharge fees, and your tax bracket to see what you actually keep
→ Why 30% profit should be your floor and what to do if your services are nowhere close
→ The client who added over $100,000 in revenue in one year
→ The client who four X'd revenue and went from 5% profit to 32%
→ Why the businesses that do not fix their pricing now probably will not be here in twelve months
If you have been avoiding your numbers out of fear or shame, this is the episode that changes that.

Resources mentioned in this episode:
→ Profitable Pricing Calculator: https://beautyindustryleaders.com.au/profitable-pricing-calculator
→ Breakeven Cost Calculator: https://beautyindustryleaders.com.au/breakeven-cost-calculator
→ ATO Industry Benchmarks: https://www.ato.gov.au/businesses-and-organisations/income-deductions-and-concessions/small-business-benchmarks/in-detail/beauty-services

Connect with me and join the Beauty Industry Leaders movement:
→ https://www.instagram.com/sammykennedycoach/
→ https://www.instagram.com/beautyindustryleaders/
→ https://beautyindustryleaders.com.au/

If you have any questions about the episode, have a burning question you would like me to answer on the show, or want to join our movement of ambitious beauty leaders, connect with me and the rest of our incredible community on Instagram:
→ https://www.instagram.com/sammykennedycoach/
→ https://www.instagram.com/beautyindustryleaders/

Transcript

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If you just pour more fuel on the fire, you keep getting more clients, more customers, more bookings, and there's no profit structured into your prices, you're gonna be so burnt out. You will be busy, you will look successful, but your bank account will tell a difference. And the businesses who don't implement this into their pricing strategy, if they don't understand their finances, if they don't make these changes now, they will probably be the businesses that don't exist six to 12 months from now. Usually they don't value themselves and they come into this and they have anxiety and then they work through the numbers and they see how much it actually costs. Not only do they stop living in the world of anxiety and avoidance, they start feeling empowered because they're making decisions from a place of confidence. I have had one of my clients increase her revenue by over $100,000 in a year. Then I've had another client who has 4X'd her revenue and gone from making 5% profit to 32% profit. Hello and welcome back to another episode on the Beauty Industry Leaders podcast. I'm your host, Sammy Kennedy. Today I want to talk to you about the importance of not just picking any number when it comes to your pricing strategy. After speaking with hundreds of business owners across different industries, one common thing that I always find is most people have no idea when it comes to their prices. They simply look at what other businesses in their area are charging, and then they'll either charge a little bit higher or a little bit lower. And so what happens is it's like the blind leading the blind. All these businesses are essentially charging a price point which they don't even know if it's profitable or sustainable for them. Now, if you're a small business owner located in Australia, you probably would have heard of some of the changes that have come into effect as of 1st of July 2026. So national minimum wage has gone up 4.75%. And then we're also paying super weekly now. And then from the 1st of October 2026, businesses will no longer be able to pass on F POS surcharge fees to their consumers. So this means that if you don't increase your prices to align with all the changes that are going on, you will find your profits are going to shrink or disappear. And so I want to talk to you about the science behind creating profitable prices. I have worked with over 400 business owners in a one-on-one capacity to actually deeply understand their mindset behind it, the actual pricing strategy itself, and how you implement it. Now, a few episodes ago, I did a podcast episode on how to increase your prices without losing all of your clients. This episode is going to be different because it's actually going to walk you through the exact steps that I would take you through if we were doing the profitable pricing calculator together. So most of the time, business owners don't actually understand how much it costs them to run their business. This is really important for you to not just outsource to your accountant or a bookkeeper. As the founder, as the business owner, as the CEO, it is your responsibility to actually know your numbers inside out. Now, so many of us are scared, we're fearful, we're ashamed, we feel guilty, we don't want to know. And it's easier living in the avoidance. But here's the thing: the more you avoid it, the more anxiety it creates for you. And so I have a breakeven cost calculator that I've created. It's a free resource. I'll drop it in the show notes for you below. This will allow you to figure out exactly how much it costs you to run your business on a weekly, monthly, and annual basis. Now, as a business owner, you're probably going to look back at the end of the financial year when you get your tax return and go, okay, this is how much money we made, this is how much we spent, and this is how much, if you're lucky, profit is left over. Now, what if ahead of time you could actually forecast and project how much your business is costing you to run? What if you could see the gaps where maybe you're overspending in some areas and need to pull some things back? What if you did an audit and you were like, you know what, we haven't used that subscription in a year? You know what? We are overpaying. Is there some way that we can negotiate? And so the best business owners aren't going to just look back on the year and then make a decision. They're going to actively be looking at, okay, what's changing in real time? So download the breakeven cost calculator and have a look at exactly how much it's costing you to run your business. This is step one of the profitable pricing calculator. So I've actually taken that sheet out and made it a standalone thing so you can understand. Now, why are we looking at it weekly and monthly? The reason why we're looking at it weekly and monthly is because you can see, based on the revenue that you're bringing in, if it is more or less than that number. And so most of the time, we don't think about breaking our big goals into smaller, achievable ones. And so looking at things in the bigger picture is great, but what about if we're looking weekly and it's costing you seven grand to run your business and you're like, look, I could either get some of these expenses down or I need to get my revenue up. Like there's three ways to increase profit in a business. So number one is you increase the prices. Number two is you decrease the expenses. And number three is you increase the frequency. But that has to be given that you're able to have profitable prices. And as a result, you can decrease the amount of time that it takes as well. So you've got increasing prices, decreasing expenses, and then increasing frequency but decreasing the time. So stay with me here. You've got to calculate how much it's gonna cost you to run your business. And then the next part of profitable pricing is actually looking at okay, how much am I spending in the different areas against industry benchmarks? Now, I do this as an extra step because I do believe there are some businesses who have no idea what's underspending, what's a good amount to spend, and what's overspending. So, as an example, if you have yourself and two team members and you decide to do a half a million dollar loan for a fit out that you've only got a five-year lease for, and that half a million dollars divided by five years, that's $100,000 a year just for your fit out costs, plus the rent you're paying on top of that. Like if you looked at any single person and went, okay, how are you going to pay that back with the number of staff you have? It would not make sense. And so being able to look at, okay, the ATO, it has a website which has industry benchmarks. It gives you an idea of like labor divided by annual turnover, it gives you an idea of annual expenses. So then that way you can see what's working, what's not. Even just typing into the internet, what are the benchmarks? What should I be spending on suppliers? What should I be spending on staff? I've had clients who have been spending up to 60% of their revenue on staff, which is not financially sustainable. And so some of these can be great indicators for us to either pull back spending, or sometimes it might look like moving money from one expense into another category that can generate a better ROI. So having a look at okay, how much money are we bringing in each month, and then taking that away from how much you're spending, we can start to see what profit is left, how much would get paid to GST, how much would get paid to tax, and then what are you truly left with at the end of the month? So we do those two sections and then we move into what are your time targets. Now, undoubtedly, you're gonna find in your business you're not always booked 100% of the time. And so when we look at, okay, what are we basing your serviceable hours on, I would look at what is your total capacity and then realistically look at okay, how many hours are you normally seeing clients? What is your average capacity? Now, if you're pretty much fully booked majority of the time, there's a few gaps. I like to base all the numbers off the 80% rule. Like if I can run my business at 100% based on 80% of the serviceable hours, anything over the 80% is obviously going to be additional revenue and profit. So you're not always going to be booked 100% of the time, which is why we don't want to base your prices on 100% of the serviceable hours. So if you had 100 hours available with you, your staff for that week, then what we want to do is times that by 0.8, and that would equal 80 serviceable hours. So we're gonna base all your numbers off the serviceable hours. Now, then within the calculator, it's gonna ask you like how many days per week you're working, and then it'll work out a monthly amount, and then it'll give you a nice little this is how much it costs you per hour, and then down to the minute. Now that's your break-even costs. So this is giving you a clear idea of exactly how much money you need to be bringing in per hour or per minute to actually just cover your costs. And that's not including GST and tax, that's just operating expenses only. The next part is looking at what are your financial goals. Now, this is so important because for you to pay yourself, for you to have profit to reinvest in the business, for you to be able to pay your team above awards so that they actually stay with you long term and don't go, oh, you know what, I'm gonna go start my own business or I'm gonna go into FIFO or whatever it is because they're feeling like they're not getting valued in the workplace. Like profit is something that you need to prioritize. And so your financial goals should be based on how much profit you would like to make. Now, are you always gonna make that? No, not necessarily. Some things may come up in business, some things are not always gonna go planned. The world might have some next war or drama or crisis that you've got to have some money there for. And this is why we need to factor the profit in so that we have a cash buffer. We're not just basing our prices on breaking even. So the way I like to do this is look at okay, what is my break-even costs? And then I'll either add a dollar or a percentage amount for my profit goal on top of that. And then that gives me an idea of like what number am I working towards. If you end up basing your profit and your revenue goal off just a random number, it's not always gonna serve you. Like I've had so many people say, I wanna make $100,000 or I want to make a million dollars. But sometimes that's not enough. Sometimes that's not actually gonna generate them profit. Sometimes that's not the correct number. So anyone who ever gives you a nice big round number for a financial goal, I would actually question that and look at what are your break-even costs, how much profit do we want to make, what gets paid to tax to GST, and base your financial goal off that number. So now we've got your financial goal. We know what you need to make for that year. We're gonna repeat the same process by looking at how many serviceable hours, how much that revenue target is going to be at an hourly amount and then per minute. So that part of the calculator actually pulls data into the final profitable pricing section. So it will come up with unique numbers based on how much it actually costs you to break even on that service, and then what you should minimum be charging if you want to reach your financial goal. Now, the next section of the profitable pricing calculator is actually being able to know your product costs for each service. Sometimes you'll have BDMs or sales managers give you this is how much a service costs based on using our products. But sometimes I find that they might be a bit inaccurate. And I'm not discrediting the brand saying like that's not true and they're trying to lie to you. I think more from a team perspective, like if you've got wastage, if you've got someone who's a little bit heavy-handed, or maybe you know, you've got people who have the need for more product versus some people with less product, like you just never know. And so I think it's really important that you still do this process manually so you know exactly how much product you are using. Because if you customize certain things in your business or you're kind of adapting them in some kind of way, those stock standard prices aren't always going to accommodate for that. So in the profitable pricing calculator, we've got like this little section which allows you to work out your product costs. So you put in the dollar amount, how many units are in that. So like it might be a hundred dollars, and then it's got 50 grams in it. And then what happens is you can put how many units you would use in that product, and then you would put five grams or 10 grams, and then that will calculate out how much it actually costs you in product. And so, what you do is you have all your services, and if you're using like a cleanser, or you're using a peel, or you're using lash glue or any kind of brow product, for example, and there's multiple services that use that, you can go in and change the units if they use less or if they use more, and then work out all the product costs. So you do this service by service, and the best part about this is you know it's actually going to be accurate to what you're using. Now, the last step of this whole process is going into the profitable pricing section. And this allows us to see all of your services, and then we write in how much time it takes in minutes. So there's no guessing with like 10 or 15 minute increments. It is just the total number of minutes. So if it takes 60 minutes, we're writing in 60. Then what happens next is you can see the break-even cost plus how much it costs in product. So the total break-even cost for that service, then the next column will show you how much you need to charge as a minimum based on your financial goal. Now, sometimes this is going to be slightly inaccurate. And I say that because if you've got lots of low-value services in comparison to like high-ticket services, there's going to be a significant difference if you have high financial goals. Like some of those low-ticket services are going to seem like a crazy amount that you can't charge. And it might be because it's not in alignment with your financial goals, or it might be a service that you need to cut. So don't always go, oh my gosh, this is going to be. So the profit is the total service price, take GST, take the FPOS surcharge fees, take your breake-even costs and product costs factored in, and then you're left with your profit. Now, depending on what tax bracket you're in, you can also apply that and it'll show you how much of that service would get paid to tax, and then how much money you're actually left over with per service. Now, this is a really powerful tool because it shows you all the numbers. It's not just take your staff wages and times by three and a half, or take this number and then take your product costs and then see what you're left with. Because we all know those strategies, they seem like they're easy to do, and they are. They take less time, but they're not giving you the full picture. And when you do this process, you understand your numbers at a deeper level than anyone else could ever help you understand them at. An accountant's not going to sit down and go through this with you because A, it's going to be a waste of their time, and B, they're doing tax compliance. Your bookkeeper might, but probably not to this level. I've had both a bookkeeper and an accountant approve, look over this calculator, and use it as a tool themselves. I believe that this is the key to financial empowerment for so many business owners. Because when you start to look at your business as a vehicle to generate profit so that you can create a life of wealth, all of a sudden, copying what the business charging down the road is doing makes you realize that that's not going to get you to where you want to go in life. And so building profit is so important in our businesses. Like, I would ideally want you to be aiming for a minimum of 30% profit on your services. Some services you're going to find are just based on the industry average. Like what I like to do is look at the three lowest charging and the three highest charging. And what that does is give you an idea of like the market size. And so you can see where you're going to sit in the market based on your prices. Are you going to be in the middle? Are you going to be in the high? Are you going to be in premium or are you going to be in low? And so when you can see the market size and actually understand what you're charging, how much profit you're making, it becomes a lot easier for you to start projecting out your goal. So if you want to make a certain amount of profit in the year, you can see how much your most profitable services are. And then you can multiply out how many services you would need to hit a certain target. Or you could work the other way. You could know, okay, I want to make this much in profit, divide that by how much profit each service is worth, and it will tell you how many of those services you need to actually sell to make that profit goal. So the science behind understanding profitable pricing is so valuable. It's not just a nice to have, it's an essential because the pricing is like the foundation, right? If you went and poured thousands of dollars into your marketing, you had ad spend running and you got all these new customers, there is no reward at the end of the day if your prices have no profit in them. And so if you just pour more fuel on the fire, you keep getting more clients, more customers, more bookings, and there's no profit structured into your prices, you're going to be so burnt out. You will be busy, you will look successful, but your bank account will tell a different story. So if this is something that you need some support with, it's something that you've been questioning and you're really scared, you can either send me a DM on Instagram and we can book in a one-on-one session to go over this together. Or we've just launched Profitable Pricing as its own training, which is incredible. So it's got video trainings, it's got the calculator, it walks you through step by step each process. I give some tips and tricks that I've learned throughout the years and all the clients I've worked with. And I believe that if you are a service provider, you're selling time for money, there are some products involved, this is the number one tool that you need to invest in for this new financial year. This is something that you want to look at quarterly. Prices are changing, the landscape is changing. We need to make sure that you're on top of this. And the businesses who don't implement this into their pricing strategy, if they don't understand their finances, if they don't make these changes now, they will probably be the businesses that don't exist six to 12 months from now. And I can tell you, this has been the best tool for so many business owners because usually they don't value themselves and they come into this and they have anxiety and then they work through the numbers and they see how much it actually costs. Not only do they stop living in the world of anxiety and avoidance, they start feeling empowered because they're making decisions from a place of confidence. They start to back themselves more, they start to charge higher prices, they attract higher value clients, people who actually value and respect their time, not the discount hunters or the people who are inconsistent with employments and they don't actually show you the respect and value that you deserve. I have had one of my clients increase her revenue by over $100,000 in a year. And then I've had another client who has 4X'd her revenue and gone from making 5% profit to 32% profit. And so depending on the size of your team, your overheads, yes, profit is going to look really different. But the more people that get educated on the numbers, set profitable prices, and they actually make their business work with their financial and lifestyle goals, the more of a reward it will actually feel like it's in business. Because when you're trying so hard to just make money and then you're working these long, hard hours, you're feeling super burnt out, and there's still nothing to show in the bank account for it, that's when you know you're in trouble. This is not something that you should avoid. This is not something that usually go, I'll think about it later. Now is the time to take action because the businesses who set profitable prices and then they reverse engineer their marketing strategy, their financial targets, their team incentives behind it, they will be the businesses that continue to thrive in the long term. I'll drop the link below for the profitable pricing training. If you have any questions, please send me a DM at SammyKennedyCoach on Instagram. I hope this episode was really valuable for you. If you have any other business owner or a friend or you want to leave a comment about your thoughts, please do it in the comment section. I'd love to hear what episode topic you would like to hear next from me. Thank you so much for tuning into today's episode. I will catch you next week. Bye.