I just read that 60% of agency owners don't track their project profit margins separately

Found this in a report from a small biz software company last week. It blew my mind because we've always looked at overall profit, not per project. We lost money on a big website redesign in Q1 and didn't even know which part of the scope killed us. How do you even price new work if you don't know what's actually profitable? What's the best way you guys track this without it taking forever?

3 comments

3 Comments

barbara4292mo ago

That 60% number is wild but I get it. We used to be in that group. Tracking per project felt like extra homework after the real work was done. Our old system was basically a sticky note on the monitor with hours guessed. We finally set up a simple spreadsheet that matches hours logged to each project's budget. It takes maybe 10 minutes a week to update. The real joke is we thought we were doing great until we saw one client was eating 80% of our time for a 10% profit.

noahw532mo ago

My buddy had that exact wake-up call, @barbara429. His "easy" client was actually costing him money once they finally tracked the hours.

jamesblack14h ago

We set up a simple rule after getting burned like that. Any client that needs more than 2 hours of back and forth in a week gets put on a strict retainer or we bump their rate 20%. It sounds harsh but it saved us from those "easy" clients that somehow eat up entire afternoons. We also do a quick 5 minute time audit every Friday just to see where the week went, and we adjust the next week's schedule based on that.