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Client Profitability Calculator

Use this client profitability calculator to see whether a client, account, or retainer is profitable by comparing revenue per hour, profit per hour, delivery load, support time, tools, and pass-through costs.

Last reviewed June 6, 2026Assumptions visiblePlanning estimate

Live calculator

Client profitability

Client profit$3,430.00

38.1% margin on this client.

Revenue per hour$160.71

56 total delivery plus support hours.

Profit per hour$61.25

$5,570.00 total modeled cost.

Labor cost$3,920.00

Loaded cost for delivery, admin, and support time.

Use this for planning and comparison. Contracts, collections, payables, tax timing, payroll, refunds, one-time bills, seasonality, and accounting treatment can change the real business result.

Quick answer

Client Profitability Calculator: what it calculates

Client Profitability Calculator uses monthly client revenue, delivery hours, admin/support hours, loaded hourly cost, tools and vendors, and pass-through costs to estimate client profit, margin, revenue per hour, and profit per hour.

ResultClient profit
InputsMonthly client revenue, Delivery hours, Admin/support hours, Loaded hourly cost, Tools and vendors, Pass-through costs
FormulaClient profitability formula

Formula

Client profitability formula

Client profit = monthly revenue - labor cost - tools and vendors - pass-through costs

Include support and admin time so the result reflects the true cost of serving the client.

How to use

Steps

  1. Enter monthly client revenue.
  2. Enter delivery, admin, and support hours.
  3. Add loaded hourly cost, tools, vendors, and pass-through costs.
  4. Review profit, margin, revenue per hour, and profit per hour.

Example

Sample calculation

Monthly client revenue$9,000
Total hours56
Client profit$3,430
Revenue per hour$160.71
Profit per hour$61.25
Total modeled cost$5,570

Calculator use

Best for

  • Reviewing an individual client before renewal, repricing, scope reduction, or assigning a different delivery team.
  • Comparing revenue per hour and profit per hour across clients that require different support, meetings, tools, or vendors.
  • Quantifying recurring scope creep by adding delivery and admin hours that are usually omitted from project estimates.
  • Testing whether a client remains worthwhile after pass-through expenses, account management, and loaded labor cost are included.

Before relying on it

Check first

  • Counting only hands-on production hours while excluding meetings, revisions, reporting, support, and account administration.
  • Treating reimbursed pass-through expenses as profit instead of matching them with the vendor or production cost.
  • Using a headline hourly wage rather than the loaded cost of the people who actually deliver and support the account.
  • Making a renewal decision from one unusual month without checking a representative period and upcoming scope changes.

Details

What to know before using the result

Scope loadDelivery plus support

Delivery hours alone can hide the true support load. Include admin, calls, reporting, revisions, project management, and client-specific coordination.

Loaded costLabor plus vendors

Loaded hourly cost should include payroll burden, contractor cost, benefits, management overhead, and other costs needed to serve the account.

Pass-through treatmentKeep consistent

If pass-through costs are bundled into client revenue, include them as costs. If they are reimbursed outside revenue, leave them out for a cleaner margin comparison.

Next decisionRetainer, margin, terms, or cash flow

After checking client profitability, review retainer pricing, agency margin, profit margin, payment terms, and small-business cash flow before changing scope or pricing.

Benchmarks

How to read the result

Low profit per hour: Review scope.

A broad heuristic that the account may be underpriced or over-serviced.

High revenue, low margin: Cost heavy.

Large clients can still be weak if pass-through costs, support, or delivery time are high.

Healthy margin: Repeatable.

Profitable clients usually have clear scope, low rework, and controlled communication load.

Calculator accuracy

Methodology and assumptions

Formula

Client profit = monthly revenue - labor cost - tools and vendors - pass-through costs

Inputs used

Monthly client revenue, Delivery hours, Admin/support hours, Loaded hourly cost, Tools and vendors, Pass-through costs

Limitations

Business results depend on contracts, accounting treatment, taxes, payment timing, refunds, collections, and operating assumptions.

Last reviewed

June 6, 2026

Cite this page

Toolkit Shelf. Client Profitability Calculator. Last reviewed June 6, 2026. https://toolkitshelf.com/tools/client-profitability-calculator

FAQ

Common questions

What is client profitability?

Client profitability is the profit left from a client after labor, admin, tools, vendors, and pass-through costs.

Should admin and support time be included?

Yes. Client calls, reporting, project management, revisions, and support can materially change profitability.

What if pass-through costs are reimbursed?

If costs are fully reimbursed outside revenue, leave them out. If they are bundled into the fee, include them.

What should I do with a low-margin client?

Check whether scope, support time, revisions, tools, or pass-through costs are driving the low margin. The next move may be to raise price, reduce scope, change terms, or stop accepting similar work.

Can this replace accounting or legal advice?

No. Business tools are scenario planners. Contracts, taxes, payment timing, accounting treatment, refunds, and legal requirements can change decisions.

What should I do after using a business tool?

Save the assumptions, compare a conservative scenario, and review the result with actual books, contracts, or an advisor before making a high-stakes decision.