The Three Immutable Laws of Profitability w/ Marcel Petitpas: Agency Profit Podcast #178
Video from Parakeeto. Watch on YouTube.
What you'll get
Marcel Petitpas, whose firm sells profitability software and coaching to agencies, defines delivery margin as the share of a firm's income, after pass-through costs such as ad spend or subcontractors, that is left once the people doing client work are paid, and shows three numbers that move it: average cost per hour, average billable rate (income divided by the hours spent earning it, whatever your pricing model) and utilization. It runs 51 minutes and is aimed at firms with staff, but a solo founder can borrow the billable-rate idea by dividing what a job earned by every hour spent on it.
Do this week
For three recent jobs, divide what the client paid, after materials and subcontractor costs, by the hours you and your people spent on it, rework included, and note which job earned the most per hour.