PROFIT PER CLIENT

How Do You Know Whether a Client Is Actually Profitable?

A client can generate impressive revenue and still be a poor economic fit if delivery costs, acquisition cost and time are too high. Profit per client turns the relationship into a number you can compare instead of a feeling.

Short answer: For each service or offer, calculate actual service profit after modeled costs, then divide that profit by the number of clients using that service. ProfitTriage uses this service-level client economics model to show where profit is strong or weak.

Profit per client is not revenue per client

Average revenue per client tells you what a client pays. Profit per client tells you what remains after the costs of serving and acquiring that client, plus the service's allocated share of monthly business costs.

The ProfitTriage method

ProfitTriage first calculates Actual Service Profit. It then divides that figure by the number of clients entered for the service.

Use the number to find weak economics

A low profit-per-client result can come from underpricing, expensive delivery, excessive admin/client time or acquisition cost. ProfitTriage compares this with profit per hour and the service's overall contribution so you can see whether the problem is price, cost or capacity.

ProfitTriage currently models client economics at the service/offer level. A named individual-client profitability model requires client-specific inputs and should not be inferred when those inputs are not provided.

What to do after you find the weak area

The goal is not automatically to fire a client. First test pricing, scope, time and cost changes. Pro combines those numbers with Capacity Doctor, pricing risk and the Full Profit Prescription.

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Explore the other ProfitTriage guides

True hourly rate & workload · Profit per client · Raising prices & client risk · Break-even pricing