Agency hourly rate calculator
Enter the fee and the hours. See what you earn per hour and whether it clears your cost.
A fee can look healthy and still pay badly per hour. Divide the monthly fee by the hours the account takes to get the effective hourly rate, then compare it with what an hour of your team costs. This calculator does that, and also shows the fee that would reach your target margin and how many accounts your team can carry. Track hours for two weeks before you trust the result. The guide on increasing agency margins covers ways to bring hours down without cutting quality.
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Cofoundr takes over the routine checking, so the same team can look after more accounts.
How it works
- Hours per account = routine hours + strategy and client hours.
- Cost to serve = hours per account x cost per team hour. Margin = fee minus cost to serve.
- Accounts the team can carry = available hours / hours per account.
- The what-if reduces routine hours by the percentage you enter, and recomputes margin and capacity.
- Cost to serve also includes any other direct costs you enter. Fee needed for your target margin = cost to serve / (1 - target margin). Effective hourly rate = fee / hours per account.
How to use the result
The default numbers are placeholders based on the 4-account scenario behind Cofoundr's time calculator, about 23.5 routine hours per account a month. Replace them with your own, measured over two weeks, for a real answer.
Common questions
Is a higher hourly rate always better?
Not if quality suffers. Protect time for strategy and client contact, because that is what keeps clients, and use the rate to find accounts that take too many hours for their fee.
Where do my hours come from?
Track time per account for two weeks in three buckets: routine checking and diagnosing, reporting, and strategy and client contact.
Is a high margin always good?
Not if quality suffers. Protect strategy time for each client, since that is what retains them.
Does this include tools and other costs?
Yes, if you enter them. Put tools, freelancers and creative costs for the account in other direct costs. Leave it at 0 to count only the cost of team hours.
What is effective hourly rate?
The fee divided by the hours the account takes. If it is below your cost per team hour, the account loses money before any other cost.
Related
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Where the time goes for an agency running 4 Meta ad accounts
Scenario: 15 minutes of checking and 30 minutes of diagnosing per account per day over 22 working days, plus 2 reports per account at 3.5 hours each. Your numbers may differ.