Problems we solve
Why are my margins shrinking?
Revenue is up and profit is flat. Everyone in the business has a theory, and none of them can be proven from the reports you currently receive.
Margin never falls for one reason. It falls for four, in different proportions.
The problem
Margin compression gets explained by whoever speaks first — materials, labor, a competitor, a discount — with no analysis behind it.
Why it matters
Each cause has a different fix. Chasing the wrong one costs a quarter and leaves the real leak running.
How to know if you have this
- Revenue growth is not converting to profit growth
- Prices have not moved while input costs have
- Explanations differ by department
- Standard costs are stale
How Advisory Motion solves it
- 01Decompose the margin change into price, cost, volume and mix in dollars
- 02Refresh standard costs so the baseline is honest
- 03Identify the specific lines, jobs or customers responsible
- 04Attach the correct fix — pricing, procurement, mix or operations — to each part
Illustrative example
1.8 points, three causes, one fix each
Input cost, mix and scrap in a 60/30/10 split. The result was a targeted price adjustment on one product family plus a yield project — not the blanket increase that had been proposed.
Illustrative composite · not a client identification
Where this connects