Do you actually know how profitable your projects are?

Published on 25 March 2025

Photo by Nataliya Vaitkevich on Pexels


If you’re a digital agency owner, this question should keep you up at night, because if you don’t know your per-project margins, you’re leaving money on the table.

But I have some good news. 🙌

There are three simple steps you can take to track your margins better and boost your bottom line. The first one’s easy; the last one gives you the most control.

1️⃣ Track Scope Creep

Projects evolve, and sometimes you deliver way more than you promised. If you’re not charging for those extras, you’re eating into your profit margin.

The fix?

Clearly define your deliverables upfront and watch for anything that goes beyond that scope. Upsell where appropriate to protect your profits.

2️⃣ Estimate and Track Time

Even if your agency doesn’t bill by the hour, time tracking is essential.

Why? Because time is your biggest cost.

If you consistently underestimate how long tasks take, you’re eroding your profits. Accurately estimating and tracking time helps you:

👉 Identify inefficiencies
👉 Spot undercharging
👉 Forecast better for future projects

3️⃣ Track Costs at a Resource Level

This one’s a bit more advanced, but it gives you serious control. Break down your costs by resource type - for example, design vs development. If your developer costs twice as much as your designer, every extra hour of development hits your margin harder. Tracking this ensures you stay on top of where your budget is really going.


🤘 Bonus Tip: Appoint someone (like a project manager) to actively track and manage project margins. This helps you identify which projects are driving the most profit and which ones are eating away at your cash flow.

Imagine this: Instead of constantly chasing more sales, you could increase your profits by simply managing your projects better. Much easier, right?

So, take a moment today to assess how well you’re tracking your margins. Your future-self will thank you for it.

About the author: Jon Munson

As a Digital Delivery and Operations Consultant, I have honed my skills while working with some of the most dynamic and innovative digital agencies in the industry. I've had the opportunity to work with teams that are punching well above their weight, and I understand the unique challenges they need to overcome.

I’ve worked as a developer, project manager, producer, head of operations and delivery lead. Now it’s time for me to help teams like yours grow and win!



3 ways I can help you:

  • Consulting for your business: I'll work with your team to develop or improve processes around how you deliver work, operate your business, and give your customers a great experience.

  • Coaching your team: I'll coach your team to level them up, implement process, or support them through any issues they are facing - no matter what their experience level.

  • 1-2-1 Coaching: From junior project manager, to operations director - I'll work with you to get where you want to be, coaching you through challenges and process every step of the way.



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