Project Profitability Calculator
Project profitability is the revenue from a client engagement minus the true cost of delivering it: hours at internal cost rate, direct expenses, and allocated overhead. The 2024 Sortlist Agency Operations Survey found 22% of small-agency clients are unprofitable when overhead is fully allocated — but only 8% of agency owners can name which 22%. Enter up to ten clients side by side to find out.
Project Profitability Calculator
Enter your top clients side by side. See which are profitable and which are losing you money.
Shared assumptions
Your clients (5 of 10)
Ranked by margin
| Client | Revenue | Cost | Profit | Margin | $ / hr realised | Status |
|---|---|---|---|---|---|---|
| Senior strategy project | $35,000 | $18,350 | $16,650 | 48% | $194.44↑ $69.44 | Excellent |
| Quick-turn campaign | $12,000 | $8,075 | $3,925 | 33% | $126.32↑ $1.32 | Good |
| Long-tenure retainer | $48,000 | $46,800 | $1,200 | 3% | $66.67↓ $58.33 | Thin |
| Recurring monthly retainer | $24,000 | $23,400 | $600 | 3% | $66.67↓ $58.33 | Thin |
| Pro-bono adjacent client | $8,000 | $8,900 | $-900 | -11% | $57.14↓ $67.86 | Loss |
| All clients combined | $127,000 | $105,525 | $21,475 | 17% | 1 client running at a loss after overhead allocation. | |
1 unprofitable client found.
Look at the bottom of the table. Those clients consume team hours that could be earning elsewhere. The article below covers what to do next.
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Method: profit = revenue − (hours × cost/hour) − direct expenses − (overhead % × revenue). Sources: Productive.io 2024 Agency Benchmarks, AgencyAnalytics 2025 Pricing Benchmark, Sortlist Agency Operations Survey 2024.
How this calculator works
Most agency owners can name their highest-revenue client. Far fewer can name their highest-margin client. Those are different lists more often than people realise.
This calculator surfaces the gap. You enter the actual numbers for your top clients across one input row each: project name, revenue, hours logged, and direct expenses (subcontractor payments, software, travel). At the top, three shared assumptions apply across every client: your team's average internal cost per hour, the share of revenue you treat as overhead burden, and your target hourly rate.
The math is straightforward. Project cost equals hours times cost per hour, plus direct expenses, plus the allocated share of overhead. Profit equals revenue minus cost. Margin is profit divided by revenue. Effective rate realised is revenue divided by hours, which lets you compare what you are actually earning per hour on that client against your target.
The results table ranks clients by margin and colour-codes the status. Negative margins flag in red. Below the table, totals show your blended revenue, total profit, and how many clients are unprofitable once overhead is fully allocated.
Frequently asked questions
What is project profitability and why does it matter for agencies?+
Project profitability is the revenue from a client engagement minus the true cost of delivering it: team hours valued at internal cost, direct expenses, and a fair share of overhead. It matters because most agencies measure project success by revenue alone, which hides the unprofitable clients. The 2024 Sortlist Agency Operations Survey found 22% of small-agency clients are unprofitable when overhead is fully allocated, but only 8% of agency owners can name which 22%.
How is project profitability calculated?+
Profit equals revenue minus three cost components: (1) hours logged on the project multiplied by your team's loaded internal cost per hour (salary plus tax plus benefits divided by available hours), (2) direct expenses for the project such as subcontractor payments, software, or travel, and (3) an allocated share of overhead expressed as a percentage of revenue. The calculator above does this math automatically across up to ten clients side by side.
What is a good profit margin for an agency project?+
The 2024 Productive.io Agency Benchmarks puts the median small-agency project margin at around 23% after team cost and direct expenses but before overhead allocation. Strong agencies target 25-40% after full overhead allocation. Margins below 10% are thin; negative margins mean you are subsidising the client from elsewhere in the business.
Why are my long-tenure clients often the least profitable?+
Long-tenure clients accumulate scope creep that never got re-quoted, communication overhead that grows with familiarity, and pricing that has not been raised in years even as your team cost increased. The clients you have had longest are statistically over-represented at the bottom of profitability rankings. The fix is annual scope and rate reviews, framed as a routine rhythm rather than a confrontation.
What should I do when I find an unprofitable client?+
Three options in order of preference. First, re-price: have the rate conversation backed by the data this calculator just produced. Second, re-scope: keep the client at the current price but reduce what you deliver to fit the budget. Third, release: graciously hand them off to a smaller provider whose cost base can sustain the rate. The clients who push back hardest on re-pricing are often the ones to release.
Read the full guide · 9-min read
How to find out which of your clients are losing you money
Why long-tenure clients drift into unprofitability, the four patterns that cause it, and what to do when you find a loss-client.
Built into Ascend
Native time tracking and project databases in the same workspace — every hour rolls up to the project record and feeds the margin math automatically.
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