Understand the client profitability report
Learn how the Client Profitability report shows which clients are most valuable and which are costing you money. Use this data to make smart business decisions.
This guide explains how to use the Client Profitability report. You will learn which clients are your most valuable, and which ones are draining your resources.
Focusing on profit, not just revenue, is key to building a sustainable business. This report helps you understand where your time and effort produce the best results, so you can make informed decisions about who you work with.
Before you start
- You need a role with the View financial reports permission.
- You must have jobs with tracked time entries or other costs.
- Staff members who track time must have a Cost Rate set on their profile for labor costs to be calculated.
- You must have created and sent invoices for the jobs you want to analyze.
Access and read the report
- Navigate to Reports → Client Profitability.
- Set the date range for the period you want to analyze. The report updates automatically.
- You will see a table with a summary for each client in that period.
Each row gives you a financial summary for a single client:
- Total Revenue: The sum of all approved invoices for the client within the date range.
- Total Costs: The sum of all labor costs and job costs. Labor cost is calculated from time entries multiplied by staff member cost rates.
- Profit: The result of Total Revenue minus Total Costs.
- Margin: The profit shown as a percentage of revenue. A
$10,000job with$7,000in costs has a$3,000profit and a30%margin. - Health Score: A weighted score that measures a client's overall value. We explain this further in the Good to know section.
ℹ️ Good to know: For the most accurate cost data, ensure every staff member has a Cost Rate set. You can add or update rates by going to Settings → Staff, selecting a staff member, and editing their profile.
Analyze a single client
To find out why a client is profitable or unprofitable, you can drill down into their activity.
- From the main report, click any client's name.
- A detailed view opens, showing a job-by-job breakdown for that client.
- Review each job's revenue, costs, and profit margin.
- This level of detail helps you pinpoint if a single difficult Job is affecting the client's overall profitability, or if there is a pattern across all their work.
Take action on your insights
Use the report to decide your next steps. Identifying your best and worst clients helps you focus your energy where it counts.
| Client Type | What It Means | Suggested Action |
|---|---|---|
| High Margin | These clients are very profitable and efficient to work with. | Nurture these relationships. Look for opportunities to provide more value and do more work together. Use them as a model for your ideal client. |
| Low Margin | These clients are barely profitable. Your effort may not be worth the return. | Review their jobs for scope creep or inaccurate quoting. Consider raising your rates at the next opportunity or renegotiating the scope of work. |
| Negative Margin | You are losing money working with these clients. | This requires immediate attention. Investigate the cause and fix it. If the issues cannot be resolved, you may need to end the relationship to protect your business. |
⚠️ Heads up: The report's data is calculated on our servers overnight to ensure performance. Changes you make today to time entries, costs, or invoices may not appear in the report until tomorrow.
Good to know
- The Health Score is a weighted average that considers three factors: profit margin (50%), total revenue (30%), and the client's average time-to-pay (20%). A high score indicates a client who is profitable, generates significant revenue, and pays on time.
- Revenue is based on the Issue Date of approved invoices. An invoice's issue date must fall within the report's date range to be included.
- The report includes archived clients by default. You can use the filters at the top of the report to exclude them if needed.