Inflation, rising labor costs, and a challenging hiring market continue to pressure profit margins. The message from this session was clear: protecting margins is not a one-time project but an ongoing discipline.
Here are the main takeaways for anyone who missed the seminar.
1. Inflation Is Still Eroding Margins
Prices for labor and materials are increasing faster than most businesses can adjust. The result is shrinking profit per unit and increased resistance from customers when prices rise.
Key Point: You cannot cut your way to growth. Strategic price increases are essential to staying profitable in 2026.
2. Move Up the Pricing Power Ladder
Not all pricing strategies create equal results. The presentation outlined four levels:
- Level 1: Cost-Based Pricing
- Level 2: Competitor-Based Pricing
- Level 3: Value-Based Pricing
- Level 4: Brand or Premium-Based Pricing
Ask yourself: Are you pricing based on cost or on the value your business provides? Stronger, more resilient companies aim to move higher on this ladder.
3. Manage Labor Costs Strategically
With hiring both harder and more expensive, labor management is a key margin lever.
Consider these steps:
- Cross-train employees to reduce dependency on new hires
- Outsource low-value or repetitive tasks
- Reassess overtime costs compared to adding headcount
- Tie compensation and bonuses to margin performance
4. Strengthen Financial Visibility
Accurate, timely data is essential. The goal is to close monthly financials within 10 days and track clear, actionable reports such as:
- Margin by job or product line
- Gross profit by category
- Labor cost per dollar of revenue
Keep dashboards simple and focused on what drives decisions.
5. Communicate with Your Bank Proactively
Banks value clients who are organized, transparent, and proactive. Victoria Shinn of People’s Bank emphasized that strong financial reporting and regular communication build confidence and improve bankability.
Action Step: Schedule a 15-minute check-in with your banker this month and share a 12-week cash flow forecast.
6. Quick Wins for the Week Ahead
- Review one product line for margin issues
- Identify one price that needs to increase
- Send your cash flow forecast to your banker
- Review labor costs for potential efficiencies
Small, consistent actions lead to stronger results over time.
Your 2026 Action Plan
- Rebuild pricing confidence
- Anchor hiring decisions to measurable ROI
- Maintain close visibility on financial performance
- Begin building your 2026 budget now
Presented by:
Brian Keyser, Director of CFO Services, Anthem
briankeyser@anthem.cpa | (503) 939-7705
Victoria Shinn, Business Relationship Officer, People’s Bank
victoria.shinn@peoplesbank.bank
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