How much revenue should your professional services firm be generating?
You probably know how much revenue you make. But do you know how much revenue you should be making?
We've made a simple calculator to help you find out. Based on some simple inputs, this tool will calculate your revenue potential, the implied revenue per professional, and give some suggestions for how to improve.
Optionally, if you provide your email address, we'll also send you our free guide, How to Grow your Professional Services Firm.
How to Use These Numbers:
On the one hand, these numbers are a pretty simple calculation. Any firm can do them.
On the other, in many cases seeing your revenue potential relative to your actual revenue is jarring. Why are the numbers so different?
There are almost always one of two issues.
First, you aren't charging enough. You might be discounting too often in order to win the business. Or your blended hourly rate reflects certain assumptions around team member allocation that are inaccurate (i.e. more work is being done by junior team members than is reflected in your stated blended rate.)
Second, your utilization rate is lower than you think. This could be a because your team isn't right-sized, or you don't have enough business.
The best way to address most of these issues is by becoming a Trusted Advisor in the minds of your prospective clients.
Doing so generates more pipeline, driving more clients and solving for utilization. It also allows you to protect your rate card or even raise rates (even when delivery is done by junior team members), creating more margin and a more profitable practice.
If you supplied your email, your guide How to Grow your Professional Services Firm is on it's way to your inbox. In it we give you a concrete plan for helping your partners or revenue-generating professionals achieve Trusted Advisor status.