Key Metrics for Agencies and Professional Services

The secret sauce for agencies and professional services is keeping an eye on these metrics 👇🏼

• Utilization Rate: Measures how effectively your team is using their time. Aim for 75-85% for billable employees.
• Gross Margin: Indicates the profitability of your services. A healthy target is 50-60%.
• Average Revenue per Client: Helps assess client value and growth potential. Monitor trends to ensure sustainable growth.
• Billable Hours Ratio: Compare billable to non-billable hours to optimize productivity and profitability.
• Client Acquisition Cost (CAC): Know how much you’re spending to acquire each client. Lowering CAC while maintaining quality is key.
• Client Retention Rate: High retention rates indicate client satisfaction and long-term profitability. Aim for 90%+.

Tip: Use software to track the data that easily populates this information for you to analyze monthly, quarterly, and annually.

Need help figuring out how to get these numbers? We can help. Please contact us for a free financial health check and learn how we make it easy to get these metrics in your business.