This calculator helps agency owners see the truth about where their money’s going and how much profit they’re really keeping. It’s simple — just plug in your real numbers and watch the results update live on the right side.
1. Start with your active clients: How many paying clients you’re currently working with.
2. Add your average retainer: What each client pays you monthly, on average.
3. Enter fulfillment cost: What it costs you to deliver for each client (labor, ads, contractors, tools, etc.).
4. Add your monthly overhead: Your fixed business expenses — payroll, software, rent, everything.
5. Set a profit goal: Pick Dollar Amount if you want to hit a specific income goal, or Percent of Revenue if you’re targeting a margin (like 25%).
6. Watch your results update: The right-hand side will instantly show revenue, net profit, margin, and break-even client count.
Play with the numbers. Try raising your retainer, lowering costs, or adjusting your overhead. You’ll quickly see how small changes make a big difference in profit — and that’s the magic of this calculator.
Pro tip: Healthy agencies usually run 20–30% net profit margins. If you’re below that, it’s time to trim costs or raise prices.
Agency Profit FAQs
Quick answer A healthy agency runs at 20 to 30 percent net profit. Under 15 percent is tight and risky. Over 30 percent means your pricing and delivery are sharp.
Profit margin is the scoreboard. It shows how well your operation turns revenue into real money. Many shops chase top line wins and ignore the bottom line. That is how people burn out. The better move is to protect margin first, then scale.
Use the calculator above. If your margin shows under 20 percent, fix pricing before you try to sell more. Raise retainers for new work, roll old clients to new plans on renewal, trim fulfillment bloat, and remove software that does not support delivery. When you land in the twenty five percent zone, you can pay yourself, invest in growth, and still sleep well. That is a business you can scale without chaos.
Quick answer Use this formula (Revenue − Delivery Costs − Overhead) ÷ Revenue. That gives you net profit margin.
Start with total revenue. Multiply active clients by your average monthly retainer. Delivery costs are the dollars required to do the work. Think freelancers, media buyers, design help, and software that is tied to fulfillment. Overhead is the fixed stack that stays even if a client leaves. Things like rent, admin pay, owner base salary, insurance, and general software.
Put the numbers in the calculator. It handles the math and shows margin in real time. If the number is weak, look at unit economics first. Raise price or trim delivery costs before you pump sales. A small price bump and a small cost drop can move margin more than two new clients. That is how smart operators grow.
Quick answer Gross margin asks, can we deliver profitably. Net margin asks, is the whole business healthy.
Gross margin equals (Revenue − Delivery Costs) ÷ Revenue. It measures how efficient your fulfillment is. If it is low, you are giving away time or paying too much to deliver. Net margin equals (Revenue − Delivery Costs − Overhead) ÷ Revenue. This is the real bottom line after everything.
You can have solid gross margin and still have weak net margin if overhead is heavy or owner pay is too high for the current stage. Strong shops keep gross over fifty percent and net around twenty five percent. Use the calculator to see both sides of the story. Gross tells you if the service itself works. Net tells you if the business works. You need both right to scale without stress.
Quick answer A good target is 30 to 40 percent of revenue for payroll tied to delivery. Over 45 percent squeezes profit fast.
This bucket includes employees and regular contractors who touch client work. If the ratio climbs, your scope is loose, your pricing is soft, or your process is messy. The quick fix is to raise price on new scopes, bundle services, templatize work, and use automation where it saves hours every week.
A simple rule that works for each dollar of revenue, spend about thirty five cents on labor, twenty cents on overhead, and keep twenty five cents as profit. Put your numbers in the calculator. Watch what happens when you trim delivery cost per client by ten percent or raise the retainer by two hundred. Payroll pressure drops and margin jumps. That is leverage you control.
Quick answer Keep overhead near 15 to 25 percent of revenue. That range gives you safety without slowing growth.
Overhead includes rent, admin salaries, insurance, general software, and your base pay as owner. Too high and your break even shoots up. You end up selling just to stand still. Too low and you may starve the systems that let you scale cleanly.
Audit the stack. Cancel tools that no one uses, move annual where it saves real money, and centralize work inside fewer platforms. Every one thousand dollars you cut from overhead is one thousand dollars of pure profit. Use the calculator and watch the break even client count fall as overhead drops. A lower break even is freedom. It gives you room to be picky with clients and protect margin.
Quick answer Most owners end up at 10 to 20 percent of revenue between salary and profit draws, once margin sits in the safe zone.
Pay yourself a fair wage for the role you truly do right now. That could be sales lead, strategist, or CEO. Then take profit on top when cash flow is steady. Keep at least two months of overhead in the bank. After that, take half of monthly profit and leave the rest to fuel growth.
Use the calculator to check net profit and runway. If profit is positive and the break even client count is low, you can pay yourself with confidence. If numbers are thin, reinvest for one more cycle. Owners get paid last, but when the math is right, owners get paid best.
Quick answer Break even is the point where revenue covers all costs and profit is zero. It tells you the floor you must stand on.
Here is the math. Break even clients = Overhead ÷ (Average Retainer − Fulfillment Cost per Client). Multiply that client count by your average retainer to see break even revenue. If the client count is high, pricing is soft or delivery is heavy.
Put your numbers in the calculator. It shows break even instantly and how small changes move it. A two hundred dollar price lift or a ten percent delivery cut can drop the required client count fast. Low break even is power. It means every client over that line throws real profit, and you can be picky with who you take on.
Quick answer Aim for 25 percent net profit. That level funds growth, pays the owner, and builds cash reserves.
Think of the ladder like this. Under 15 percent, fix pricing and scope. At 20 percent, you are stable but tight. At 25 percent, you are healthy and scalable. Over 30 percent, you are elite and can invest aggressively in brand and media.
Use the calculator to run quick what if moves. Raise the retainer by two hundred. Trim fulfillment cost five percent with better process or automation. Drop one unused software plan. Watch margin jump. You do not need more clients. You need better clients and better math. Lock the target at twenty five percent and protect it. That is how you build wealth, not just revenue.
