For many SMEs, improving profitability doesn’t require more customers — it requires better pricing. Yet pricing is often one of the least structured parts of a small business. Many owner-managed businesses rely on historic rates, gut feel, or “what we’ve always charged”, without a clear pricing strategy or visibility of gross margin.
This article explains how SMEs can price for profit, increase gross margin, and create a scalable commercial model based on our work supporting UK businesses.
Our work with SMEs shows consistent themes:
When pricing isn’t intentional, profit isn’t intentional either. And without clear gross margin targets, SMEs often make far less money than they should.
If you’ve ever wondered, “How do I increase my gross margin?”, “Are we charging enough?”, or “Why are our profits not improving despite strong sales?” — pricing is usually the answer.
Undercharging doesn’t feel like a decision. It feels like:
But without visibility of cost and margin, it’s impossible to know whether a job is profitable.
A structured pricing model turns uncertainty into clarity.
To price for profit, SMEs need to adopt a margin-first approach:
This includes all direct costs including materials, direct labour/services, sales fees etc.
Margin should be deliberate. Not accidental.
The most effective tool we implement is a simple margin indicator (red/amber/green).
If the quote isn’t green, the price isn’t right.
This avoids inconsistency and protects margin.
A pricing calculator or quote-building tool:
Customers trust suppliers who respond quickly with a clear, professional quote — and this trust significantly reduces price resistance.
SMEs often overlook the commercial impact of speed. When a prospect receives a quote:
…they are far more likely to say yes.
Fast, accurate quoting is one of the most powerful ways to increase conversion rates without discounting.
This is why a pricing calculator is one of the most valuable tools a growing SME can implement.
A deliberate pricing strategy can transform profitability:
Many SMEs improve profit significantly without winning any additional work — simply by pricing existing work correctly.
Ask yourself:
If not, there is almost certainly profit being lost.
Improving pricing is not about charging “as much as possible”. It is about:
SMEs that adopt a disciplined, margin-driven pricing strategy will experience significant improvements in profitability, confidence and commercial resilience.
At Secantor, we help SMEs build pricing systems that make profitability deliberate — not accidental.
Read our Pricing for Profit case study to discover how Secantor helped one of its clients improve gross profit margin from 25% - 35%.