Agency profit refers to a monetary amount determining how much money an agency has made, over a specific time period.
Formula: Profit = Revenue − Costs
Agency profitability is the relative measure of financial success/efficiency, and depends on how much an agency is generating revenue that surpasses costs.
It can be calculated in a variety of different ways (e.g. client profitability, project profitability, return on assets [ROA], overall agency profit margins, etc.)
Agency profit margin is the percentage of revenue that becomes profit. It is used to give an insight into an agency’s profitability.
This can be calculated in a few ways, including net profit margin, gross profit margin, or operating profit margin.
Net profit margin formula: Net profit margin (%) = (Net profit/Revenue) x 100
Gross profit margin formula: Gross profit margin (%) = Revenue – Cost of services sold/Revenue) x 100
Agency margins is a broader term for various types of margins in an agency’s operations. It represents an agency’s efficiency at various stages.
This is likely referring to profit margins (see above), but could also refer to other margins such as mark-up or labor utilization margins.
Further reading: Agency margins and agency profit margins explained
An agency metric is anything you can quantifiably measure in relation to the agency’s performance.
However, that doesn’t mean all metrics are useful indicators of business success. For example, one metric could be project headcount, but if the goal was to increase productivity or drive project success, this may not be the best metric to track.
Further reading: 16 essential agency metrics that’ll ramp up revenue (with examples)
Agency goals are more broad, overarching, and long-term. They provide a sense of purpose and direction for your agency.
For example, your overarching goal may be to have long-term client relationships.
Agency objectives are more specific targets used to support the achievement of goals. They are precise and actionable, providing clear criteria for success and progress tracking.
“Objectives” and “KPIs” are often used interchangeably as terms but, in theory, KPIs should be used as earlier indicators of whether you’ll hit an objective, and in turn a wider goal.
For example, if your overarching goal is to have long-term client relationships, an objective to get there may be to increase client retention.
An agency KPI (key performance indicator) is a specific metric you’ve decided to track and prioritize because it’s a crucial indicator of success. KPIs are directly tied to your agency strategy, objectives, and goals.
For example, if your overarching goal was to have long-term client relationships, and you had an objective to increase client retention, a KPI to help keep you on track may be client satisfaction score (or NPS.)
This would allow you to identify churn signals, and therefore help you meet these client retention objectives.
Further reading: Understanding agency KPIs: 6 simple steps to unlock growth
Agency revenue (which is sometimes also referred to as “sales” or “gross income”) is the total amount of money generated by an agency from its business activities (typically from client services,) before any expenses are deducted.
Further reading: Agency sales: The ultimate playbook for winning business
Billables include anything that can be charged to a client. These may include items, services, or expenses.
Billable hours are the total number of hours spent on tasks and activities that can be charged to a client.
Try our online billable hours calculator for a simple way to crunch your numbers.
Billable time is the total number of time spent on tasks and activities that can be charged to a client.
Billable work includes tasks and activities that can be directly charged to a client, and that directly impact revenue.
Billable rate is the amount charged to a client for a specific service.
Typically, this is charged on an hourly basis, but an alternative timeframe may be used (such as daily billable rates).
To calculate what a billable rate should be, you might consider salary plus other costs (like rent or equipment), estimated billable hours, and a profit margin.
Billable value (or billable amount) is the total amount of billable hours that can be charged to a client, over a chosen time period.
Usually this is calculated by multiplying the total number of billable hours by hourly billable rate.
Billable utilization is the percentage of work hours spent on billable work by an individual, department, or company.
This metric represents exactly how much time your people spend on work that generates revenue and can help you assess and analyze the overall performance and health of your business.
Billability and billable utilization rate are used interchangeably with “billable utilization,” meaning that it’s the percentage of working hours spent on billable work.
Billable utilization rate formula: Billable utilization rate (%) = (Total billable hours/Total available hours) x 100
Further reading: Billable utilization: A beginner’s guide to increasing revenue
Capacity planning is assessing whether you currently have enough capacity and the right skillsets available to reasonably achieve your plans and meet the required demand.
Further reading: Resource capacity planning: A 2025 guide
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Designed for a single employee to track the total amount of hours worked over a specific timeframe, such as a week or month.
An employee timesheet template for individual employees is not focused on start and stop times or recording time against a particular project. Instead, it records the total number of hours worked, and the utilization rate of the specific employee.
Further reading: Employee timesheet templates: For individual and multiple employees
An employee timesheet template for multiple employees is a tool for anyone who needs to oversee how utilized a group of employees is.
It focuses on the total number of hours worked by each employee, and their utilization rate over a specific timeframe. It does not record the stop/start times for each area, or a breakdown of the specific tasks an individual has worked on.
Further reading: Employee timesheet templates: For individual and multiple employees
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Non-billable work cannot be charged to a client. This includes time spent on tasks such as admin, business development, internal meetings, and training.
Further reading: Billable utilization: A beginner’s guide to increasing revenue
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Productive utilization is the percentage of hours spent on work tasks that aren’t billable, but are essential to the growth of your business.
Project management is the practice of planning, executing, and monitoring a project, so it can be as successful as possible in line with your predefined goals.
A project timesheet template is designed for individual employees to track their project hours.
Built for team members who need to record all the time they’re spending on multiple tasks and projects. If you’re only working on a single project at a time, this template would also help you.
Further reading: Project and project management timesheet templates
A project management timesheet template is designed for project managers (or other team members) who need a more top-level view of project hours on a particular project they’re overseeing.
This template allows project managers to track how much time multiple employees have spent on the same project, all in one place.
Timesheets are a specific way to track project time.
Project timesheets are used by individual team members to record how much time they spend across their projects and tasks.
While there are several ways to do this, it’s common to use a dedicated project timesheets tool or a project timesheet template to input hours.
Further reading: Project and project management timesheets: 101 guide
Project management timesheets are used by project teams to track overall progress and utilization across multiple projects and employees.
To do this, a more comprehensive project management timesheets solution (with additional features) is typically used. But, you can also use a project management timesheet template if your needs are less complex.
When you combine time tracking and project management, you get project management time tracking.
This is where project managers (and other relevant team members) have an overview of the amount of time multiple individuals spend on various tasks and activities within a project.
Another term used is project time tracking, which has a slightly different focus to project management time tracking.
This is where individual project team members track their personal progress of their projects, by using time spent as their primary metric of progress.
This project time tracking data can help facilitate project management time tracking.
Project time tracking tracks the time spent on a project at a higher level. Project task time tracking is a more granular approach to project time tracking, where you track specific tasks against a project.
In addition to time spent, there are other areas of project tracking, including tracking milestones, resources, budgets, or timelines to keep an eye on a project’s trajectory.
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Resource allocation involves identifying who will do the work, and then assigning and distributing the work among the people and resources who will get it over the line. This will be based on skills, availability, and project priority.
Further reading: The complete guide to resource allocation in project management
Resource allocation tracking is similar to resource tracking, but is specifically concerned with the assignment and distribution of those resources, to ensure specific goals are met.
Resource management is the overarching discipline of managing people, equipment, and resources including planning resources and capacity, allocating, scheduling, tracking, and forecasting resources, as well as monitoring utilization.
Resource management time tracking refers to one specific process within the overarching discipline of resource management. Here, the actual time resources spent on various tasks is tracked and recorded.
This is different to other areas of resource management, which focuses more on the upfront planning of resources. However, resource management time tracking data can be used to plan resources more effectively in the future.
Resource planning involves identifying what resources are needed for your plans—either on a task, or project level, or a wider business level.
Further reading: Agency resource planning and management guide
Resource scheduling involves scheduling when the people will do the work for the tasks or projects over time, to meet specific goals, milestones, and deadlines.
Further reading: Best resource scheduling software: 2025’s top 10
Resource time tracking specifically focuses on tracking the time associated with any type of resource.
For example, you may need to track the number of hours a piece of equipment was hired for during a quarter, or the amount of days an employee worked on a product launch.
A resource tracker is a tool or system used to facilitate resource tracking (e.g. dedicated software, spreadsheets, etc.)
Resource tracking is the process of monitoring how people and resources are being used in real time, and could include different areas of measurement such as time, budget, or utilization.
Resources may include: skill sets, materials, tech, physical equipment, or people.
You can measure these different resources in various ways, such as tracking headcount or budget. For example, you may need to track the money spent on equipment for a specific campaign.
Resource utilization is a resource tracking metric that assesses how efficiently people and resources are being leveraged for tasks or projects.
Usually it’s measured in percentages that reflect what proportion of the person or resource’s availability is used.
It can also be broken into billable and non-billable utilization.
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Time tracking is the act of generally tracking and recording the amount of time that is spent on areas such as tasks, activities, projects, or resources.
Time tracking software is any type of software used to track time, but not limited to timesheets software.
Time tracking software could include: software that tracks time spent on different devices/tabs, a time tracker stopwatch, a time tracking spreadsheet, timesheets software, etc.
Further reading: New feature—effortless, accurate timesheets
In most cases, utilization is also synonymous with “billability” and “billable utilization.”
If you see the word “utilization” as a standalone noun, it’s safe to assume it means billable utilization. The same goes for “utilization rate.”
But not all utilization is billable utilization (e.g. resource utilization and productive utilization.)
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