Agencies · 🇦🇺 Australia
Winning work that lost money, repeatedly
An agency with no project-level cost tracking kept pitching the work type that was least profitable.
Australian creative agency, 20 staff, project-based. Client identity withheld — we publish names only with written permission, so this engagement is described by its shape rather than by who it was.
Project-level
Profitability introduced
2
Service lines repriced
1
Service line discontinued
The situation
- The agency measured profitability at company level only and assumed all service lines were broadly similar.
- New business focused on whichever work was easiest to sell.
What we found
- No time capture against projects, so staff cost could not be allocated.
- One service line consumed disproportionate senior time and was priced as though it did not.
- Rework was invisible — projects redone were not distinguished from projects delivered once.
What we did
- Introduced project-level time capture and allocated staff cost accordingly.
- Built per-project and per-service-line profitability reporting.
- Separated rework so the true cost of quality problems became visible.
The outcome
- The agency repriced two service lines and discontinued a third that could not be made profitable at any price the market would pay.
- Rework turned out to be a larger cost than any single service line's margin gap.
What we'd flag
Time capture was unpopular with staff and took two months to become reliable. Agencies that introduce it half-heartedly get data they cannot trust.
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