What the calculator does
Side-by-side ranking.
- Up to five clients with monthly revenue, direct labor cost, program fees, team hours and days to pay.
- Your team’s loaded cost per hour and your cost of funds.
- Gross margin and true margin for each client, ranked best to worst.
The formulas
Each hidden cost is turned into dollars.
- Team cost = team hours × team cost per hour.
- Cost of waiting = revenue × (days to pay ÷ 365) × cost of funds.
- True profit = revenue − direct cost − fees − team cost − cost of waiting.
Worked example
Client A bills $60,000 a month with $48,000 of direct cost, $1,800 of fees, 20 team hours at $35 and 45 days to pay at an 8% cost of funds. Gross margin is 17%, and true margin is about 14.8%.
How to use the ranking
Start the next rate or terms conversation with the client at the bottom. The levers are rate, payment terms and how much team time the account consumes.
Frequently asked questions
What should team cost per hour include?
Salary plus employer costs divided by working hours for the recruiters and coordinators who serve the account.
Does the sample data mean anything?
No. The rows are illustrative. Replace them with your own figures.