Client Profitability Calculator
Calculate client profit, margin, labor cost, total cost, and profit per service hour from revenue, delivery time, direct costs, and acquisition cost.
What this tool can do
Combine direct, labor, and acquisition costs. Calculate client profit and margin. Show profit per service hour. Compare clients using one consistent cost scope.
Formula and methodology
Client profit = client revenue − direct costs − acquisition cost − (service hours × internal hourly cost).
Worked example
A client producing €12,000 revenue with €1,000 direct costs, €500 acquisition cost, and 80 hours at €50 produces €6,500 profit and a 54.17% margin.
Choose one client and period
Keep revenue, delivery hours, direct costs, and acquisition cost within the same client relationship and review period. Mixing lifetime revenue with one month of costs overstates profitability.
Use cost, not billing rate, for delivery time
The hourly cost should represent the internal cost of providing the work. The price charged to the client belongs in revenue and should not be counted again as labor cost.
Separate profitability from cash timing
An issued invoice, earned revenue, and collected cash answer different questions. Pick one revenue basis and document it before comparing clients.
Investigate the result
A low-margin result can come from scope growth, unbilled work, excessive acquisition cost, omitted expenses, or a pricing decision. Open the source records before changing a client relationship.
Privacy
Calculations and draft documents run in your browser. Entered values are not included in FollowIncome analytics events.
Next step
Use the result as a planning aid, then track actual invoices, payments, expenses and projects in FollowIncome.
Frequently asked questions
How do I calculate profit per client?
Subtract the direct costs, customer acquisition cost, and internal cost of service time from the revenue assigned to that client for the same period.
Should customer acquisition cost be included?
Include it when the decision concerns the full economics of winning and serving the client. Keep it separate when reviewing only delivery margin.
Is client revenue the same as cash collected?
Not necessarily. Use invoices, earned revenue, or collected payments consistently and label the basis used.
Are the financial values stored?
No. The calculation runs in the browser, and entered amounts or calculated results are not included in analytics events.
Related guides and tools
Project costs and profitability
Plan revenue and delivery costs, then compare the estimate with recorded project results.
- Project profitability calculator
- Retainer profitability calculator
- Profitability toolkit
- Project profitability guide
- Task cost tracking
- Project profitability software
Agency capacity, clients, and retainers
Connect billable capacity with the profitability of client relationships and recurring retainers.
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