Professional Services Intelligence Brief
How to Identify Service Offerings That Deserve Further Investment
Not every service deserves the same attention. Compare each one on margin, demand, capacity and strategic fit, then invest where the evidence is strongest.
Short answer
To decide which service offerings deserve investment, rank each service on current margin, demand and growth, capacity needed, strategic fit and client value, using your own data alongside outside evidence on demand. Services that combine healthy margin, rising demand and a clear client benefit are candidates to scale; services with low margin and flat demand are candidates to fix or retire. The Small Business Administration advises using market research to find customers and understand demand before expanding,[1] and benchmark data show that firms with mature pricing, delivery and resource management earn project margins above 50 percent, against an average of 37.7 percent.[2]
Why compare services instead of the firm as a whole?
A firm’s overall margin hides large differences between services. One service may be a profit engine, another a loss-maker kept alive by habit, and a third a promising idea that has not been resourced. Investment decisions, such as hiring a specialist, building a tool or launching marketing, should follow the evidence about each service, not the firm average. Benchmark data illustrate the spread: SPI Research’s 2026 benchmark, summarized by Deltek, found an average project margin of 37.7 percent in 2025, while the most mature firms reported margins well above 50 percent, driven by pricing, delivery governance and resource management.[2]
Service-line analysis is also how a firm finds its direction. Services that clients value and that your people deliver efficiently are the ones to scale; services that clients tolerate but that drain capacity are the ones to reprice, restructure or stop.
What should you measure for each service?
Use a scorecard of measures you can calculate or estimate. For current performance: revenue, direct margin after labor, realized rate per hour, share of firm capacity used, repeat rate and average engagement length. For demand: growth in your own pipeline, enquiries and win rate, plus outside evidence on market size and trend. For fit: how closely the service matches your team’s strengths, how often it leads to other work and what it contributes to your reputation.
| Dimension | Questions to answer | Where the evidence comes from |
|---|---|---|
| Margin | What is the margin after direct labor and a share of overhead? | Timesheets, invoices, cost data |
| Demand | Is demand rising, flat or falling? How big is the market? | Pipeline, win rates, market research[1] |
| Capacity | How many hours does it use? Can it scale without hiring? | Utilization and staffing data |
| Client value | What problem does it solve and what are clients willing to pay? | Client interviews, value pricing analysis[5] |
| Strategic fit | Does it build on strengths and lead to other work? | Leadership judgement, cross-sell data |
| Risk | How concentrated is revenue? How easy is it to copy? | Client mix, competitor review |
How do you find evidence of demand?
The SBA recommends using market research to find customers and competitive analysis to understand how to be different; it says research lets you reduce risks, and suggests combining demographic and market information with an understanding of the specific market share that will affect your profits.[1] For a professional firm this means looking at three sources. Inside the firm: pipeline data, enquiry sources, proposals won and lost, and what existing clients ask for. Clients: short interviews with five to ten clients and lost prospects about the problems they face. Outside: industry surveys, trade bodies and public data on the sectors you serve.
Look at what peers are offering too. A national accounting practice survey summarized by the Texas Society of CPAs reported that the services offered most often by Texas respondents were advisory or consulting (77 percent), client accounting advisory (69 percent) and tax services (66 percent).[4] Such data do not tell you what to do, but they show where the profession is allocating effort, and where there may be crowding.
How do you test an idea before investing heavily?
Test small, with explicit success measures. A practical sequence is to define the offer in one page (who it is for, the problem, scope, price), sell it to a handful of existing clients, deliver it, and measure margin, effort, client satisfaction and referrals. The accounting practice described by the Journal of Accountancy began value pricing with new clients, then began offering existing clients additional services, such as tax planning, that had high perceived value without taking much time to complete; after seven years the firm had a portfolio of offerings at a range of prices based on the likely return to the client.[3]
Set kill criteria in advance, for example fewer than three paying clients within six months or a margin below a threshold, and review honestly. Services that miss their targets can be reworked or stopped. Be wary of services that depend on one star individual: a service that cannot be delivered without them is a risk, not an asset.
How do you decide where to put the money and the people?
Rank the services by evidence, then invest in a sequence. First fix what is already large but weak: a service with high revenue and poor margin may need only better scoping, pricing or staffing to release profit. Second, scale what is strong: services with healthy margin, rising demand and available capacity deserve marketing, specialist hires and productized tools. Third, explore a few options at small scale. Do not spread investment across everything; concentrate on the one or two services where the evidence is strongest, and set a review date.
Frequently asked questions
How do I know which services are most profitable?
Compute direct margin by service after labor, plus a share of overhead, using timesheets and invoices. Benchmark averages are only a rough guide: Deltek’s summary of SPI data cites an average project margin of 37.7 percent, with the most mature firms above 50 percent.[2]
How can I check there is demand for a new service?
Use market research and competitive analysis, as the SBA advises, and combine it with your own pipeline data and client interviews.[1]
Should I stop services that earn little?
Not automatically. First test whether better pricing, scoping or staffing can fix them, and consider their strategic value, such as whether they lead to other work. If margin and demand are both weak, reduce or stop them.
What services do accounting firms offer most?
A 2018 national practice survey summarized by the Texas Society of CPAs reported that Texas respondents most often offered advisory or consulting (77 percent), client accounting advisory (69 percent) and tax services (66 percent).[4]
How long should a new service be tested?
Set the period and success measures before launch, for example paying clients and margin within six months, and review honestly against them.
What to do next
- Build a scorecard of your services with margin, demand, capacity and fit.
- Interview five to ten clients about the problems they cannot solve today.
- Pilot one new or reworked service with a clear success threshold.
- Concentrate investment on the one or two services with the strongest evidence.
Optional · interactive example
See it in an interactive example.
Firm Economics Dashboard: a service-line dashboard with utilization and realization, a scenario simulator for hours, rate and cost, evidence-linked answers from APIS, and a sample brief, all on synthetic data.
The experience below is built on a synthetic firm, “Demo Advisory Partners,” analyzed by service line. It has no client-level or engagement-level records, so service lines are used to show the method. Nothing in it is real.
- In the service-line table, sort by Contribution margin. Which are highest and lowest?
- Select Litigation Support. Its hours fell while its rate and margin rose. What would you want to know?
- Ask APIS which service lines warrant a closer review.
Understand Your Firm’s Economics and Growth Opportunities
Two Pillars helps professional services firms investigate profitability, capacity, pricing and growth using the firm’s own data and a structured assessment process. A good first step is a firm economics review that follows your own hours from capacity to cash, by client, service and person, and shows where margin is lost.
Sources
- U.S. Small Business Administration, Market research and competitive analysis. Accessed October 2026.
- Deltek, 5 KPIs from the SPI Professional Services Maturity Benchmark Report Every PSO Must Track for Sustainable Growth (July 15, 2026). Accessed October 2026.
- Journal of Accountancy (AICPA), How implementing value pricing can help your staff get more done (2017). Accessed October 2026.
- Texas Society of CPAs, 2018 MAP Survey Summary (AICPA PCPS/CPA.com National MAP Survey). Accessed October 2026.
- The CPA Journal, How Accountants Can Implement Value Pricing (Bonyuet, 2025). Accessed October 2026.
Sources checked October 2026. This guide is general information for the leaders of professional services firms and is not legal, accounting, tax or financial advice. Figures and rules are cited to the sources below and may have changed since they were accessed, so confirm anything you rely on against the current source. Two Pillars & Co is independent of the organizations cited. See our editorial policy.