Your year-end P&L is almost complete. You worked harder than ever. Revenue looks good on paper. But when you look at your actual profit, it’s barely higher than last year. Maybe even lower.

The money came in, but it leaked right back out through business overhead costs you stopped questioning years ago. Software subscriptions on auto-pay. Insurance policies you haven’t shopped since 2019. Vendors charging the same rates they did five years ago when everything else got more expensive. You’re not spending money strategically, you’re just letting it walk out the door month after month.

You have just a few days left to cut unnecessary costs and improve your 2025 final numbers. Every dollar you eliminate before December 31 doesn’t just help this year, it sets your 2026 baseline $12 higher for every monthly expense you cut. Miss this window and you’ll pay those same unnecessary costs for another 12 months while your profit margin keeps shrinking.

Why You Should Listen to Me About Business Overhead Costs

I’m Ryan Herrst with Media Ace Advisors. I’m a Certified Profit Advisor and author of “Profit Foundation.” I help service business owners earning $250K to $5M annually discover hidden profit opportunities without spending more on marketing.

My father taught me something that applies perfectly to business overhead costs. He said “All because you can, doesn’t mean you should.” Just because you CAN afford that subscription, that vendor, that insurance premium doesn’t mean you SHOULD keep paying it if there’s a better option.

I work with the 7-Step Pathway to Profit framework. It examines seven profit levers in every business. Leads, conversion, transaction size, frequency, margins, retention, and referrals. Most business owners obsess over getting more leads while ignoring the other six levers. But often the biggest opportunity isn’t generating more revenue, it’s keeping more of the revenue you already generate. That’s where business overhead costs come in.

I’m not a marketing agency trying to sell you more services. I’m the profit advisor who helps you find money you’re already earning but losing to unnecessary expenses. I’m the coach who helps you work smarter, not harder. Over the past 18 months, I’ve helped dozens of service businesses identify $20K to $70K in annual cost savings without cutting quality or service delivery. The money is there. You just need to know where to look.

The Hidden Overhead Trap That’s Killing Your Margins

Let me share a real example from a business owner I spoke with recently. I’ll call him Mark. Mark owns a commercial cleaning company. $720,000 in annual revenue. Fifteen employees. Good reputation in his market. Busy all the time. When we looked at his year-end numbers, his profit margin was 9%. Industry standard should be 18% to 22%.

Mark wasn’t spending on fancy toys or excessive owner draws. The money was disappearing through business overhead costs he’d forgotten about. He was paying $410 per month for a CRM platform his team barely used. He was paying $15,200 annually for business insurance when a competitor quote came in at $10,800 for identical coverage. He had three different marketing software subscriptions doing essentially the same thing, totaling $890 per month. He was paying 2019 vendor pricing for supplies when the market had shifted and competitors were offering 25% less.

When we added it all up, Mark was leaking $43,600 annually through overhead costs he could eliminate or reduce without affecting a single client or employee. That’s not small money. That’s the difference between a 9% margin and a 15% margin. Between struggling and thriving.

The psychology of “set it and forget it” expenses is what kills most small businesses slowly. Once something is on auto-pay, it becomes invisible. You’re so focused on getting new clients that you ignore the money walking out the back door every month. You built this business to be profitable. You deserve to keep more of what you earn.

The 60-Minute Year-End Audit That Finds Hidden Money

You don’t need a consultant to find these opportunities. You need 60 minutes and the willingness to ask hard questions. Here’s the system.

Start by pulling your statements. Grab your last three months of bank statements, credit card statements, and recurring vendor invoices. Put them in front of you. No laptop open, no distractions. Just you and the numbers. Print them if possible because seeing them on paper makes patterns jump out differently than scrolling on a screen. Give yourself 10 minutes for this phase.

Next comes the Red Flag Test. This takes about 20 minutes. Go through every line item and ask yourself three questions.

First question is “Do we still use this?” Flag anything you haven’t actively used in the last 90 days. That unused CRM sitting there charging you monthly. That software subscription someone on your team wanted two years ago but never actually implemented. That association membership you joined with good intentions but haven’t attended in six months. If it’s not actively contributing to your business operations or revenue, flag it.

Second question is “Are we paying 2019 prices for this?” Flag anything you haven’t shopped or renegotiated in over two years. Insurance policies, vendor contracts, supplier agreements, contractor rates. Prices change. The market shifts. Competition drives costs down in some areas. If you’re still paying what you paid five years ago for something, you’re probably overpaying. The companies you do business with aren’t volunteering to lower your rates. You have to ask.

Third question is the most powerful one. “Would I buy this again today?” If you were starting your business today with everything you know now, would you purchase this service, subscribe to this tool, or hire this vendor? Be honest. Sometimes we keep paying for things because we’ve always paid for them, not because they still make sense. If the answer is no, flag it immediately.

Now do the math. This takes about 15 minutes. Add up everything you flagged. For monthly costs, multiply by 12 to see your annual expense. For annual costs, write them down as-is. This is your hidden profit opportunity sitting right there in black and white. Most service businesses find between $20,000 and $70,000 in this exercise alone. The conservative average is around $35,000. That’s real money. That’s not theoretical savings, that’s actual dollars leaving your bank account every year that could be staying in your profit margin.

The final phase is your action plan. This takes 15 minutes. Sort your flagged expenses into three categories.

First category is “Cancel Immediately.” These are the unused subscriptions, the duplicate tools, the services delivering zero value. Pick up the phone today and cancel before December 31. Stop the bleeding. These are the easiest wins because you lose nothing by cutting them. They’re pure waste.

Second category is “Renegotiate Before Renewal.” These are your insurance policies, vendor contracts, and major software platforms. Shop competitive quotes this week. Get three proposals for your insurance. Ask your current vendors if they can match market rates. Negotiate with your software provider about downgrading to a lower tier that still meets your needs. Lock in better rates for 2026 before your current contracts auto-renew.

Third category is “Downgrade or Optimize.” These are services you want to keep but where you can reduce the tier, adjust the usage, or find a more cost-effective option. Maybe you’re paying for 50 user licenses when you only have 12 active users. Maybe you’re on the premium plan when the standard plan has everything you actually use. Make these adjustments before January billing cycles kick in.

You can do this yourself. You don’t need permission from anyone. You don’t need to hire a consultant. You just need to block out 60 minutes and be willing to question every expense on your books.

Real Numbers From Real Businesses

Here are three quick examples from business owners I’ve spoken with recently. A law firm found $43,000 annually through insurance renegotiation, software consolidation, and vendor pricing review. They cut nothing that mattered. They just stopped overpaying.

A medical practice found $38,000 annually by eliminating duplicate marketing services, renegotiating merchant processing fees, and canceling unused software tools. Their patient experience didn’t change at all. They just became smarter about their business overhead costs.

A contractor found $52,000 annually through equipment rental optimization, insurance shopping, and supply vendor consolidation. Same quality work. Same client satisfaction. They just stopped letting money leak out unnecessarily.

None of these businesses cut quality. None reduced service to their clients. They just stopped paying for things they didn’t need and stopped overpaying for things they did need. These business owners deserve to keep what they earn. So do you.

Why December Matters More Than You Think

Finding $50,000 in December doesn’t just improve your 2025 tax return. It sets your entire 2026 baseline $50,000 higher. That’s $50,000 you can reinvest in growth, your team, better equipment, or your own salary. It’s the difference between a 10% profit margin and a 16% profit margin. Between feeling stressed about money and feeling confident about your financial foundation.

Most business owners plan to “look at expenses sometime next year.” January gets busy. February brings tax season. March has its own fires to fight. By the time they actually review their business overhead costs, it’s November again and another year of unnecessary expenses has walked out the door. The pattern repeats year after year.

December is your window. You have just a few days left. Use them.

Want to See How Your Industry Compares?

I’m currently interviewing service business owners for the second edition of “Profit Foundation,” my book on profit strategies for small businesses. The focus of these interviews is understanding industry-specific overhead patterns and where different types of businesses typically overspend.

During our 45-minute conversation, I’ll share what I’m learning about cost structures across industries and you’ll see how your business compares to the patterns I’m seeing. It’s a research conversation, not a business evaluation, but most people walk away with two or three ideas they can implement immediately to cut unnecessary costs before year-end.

If you’d like to participate and receive a complimentary copy of the book when it’s published in 2026, you can schedule here: https://mediaaceadvisors.com/contact/

There’s no cost and no sales pitch. These are genuine research conversations where I’m gathering insights for the book while sharing what I’m learning across industries. The December slots are filling up quickly because of year-end planning urgency, so if this interests you, schedule before the end of the month.

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About the Author:

I’m Ryan Herrst with Media Ace Advisors. I help service business owners (annual revenue $250K to $5M, 10 or fewer employees) identify hidden profit opportunities and create clear pathways to growth. My approach focuses on systematic improvements across all seven profit levers, with special emphasis on cost optimization and profit margin protection.