Revenue ranking lies
Two projects, both invoiced at €6,000. The first took 40 hours; the second took 95, because the client changed direction twice and every deliverable came back with comments.
| Project A | Project B | |
|---|---|---|
| Invoiced | €6,000 | €6,000 |
| Hours | 40 | 95 |
| Direct expenses | €200 | €450 |
| Profit | €5,800 | €5,550 |
| Effective hourly | €145.00 | €58.42 |
Identical on the revenue report. Two and a half times apart on the only number that decides whether you should take that work again. If you rank clients by invoice value, B looks exactly as good as A — and you will keep saying yes to B.
The three numbers per project
- Invoiced. What you have billed, whether or not it has been paid.
- Direct cost. Expenses attributable to that job — subcontractors, stock images, hosting, travel. Not your general software subscriptions.
- Hours. All of them, including the admin and the calls, because those are precisely what distinguishes a good client from a bad one at the same price.
Profit is the first minus the second. Effective hourly is profit divided by hours. Neither requires accounting software — they require that hours and expenses were attached to the project when they happened, which is the only genuinely hard part.
Reading the number honestly
A low effective rate is not automatically a bad project. Ask which of these it is:
- Priced wrong. You quoted from an old rate or guessed the scope. Fixable next time by quoting from cost, not from habit.
- Scoped wrong. The work grew and nobody billed for the growth. Fixable with a change-order habit, not with a higher price.
- Learning. The first project in a new skill is slow by definition, and the rate on project two is the one to judge.
- Just a bad fit. Some clients cost more to serve than they can be charged. This is allowed to be the answer.
What to do about the bottom of the list
The instinct is to fire the worst client. Usually wrong, and rarely necessary. The cheaper move is to change the terms: a fixed fee where hours ran away, a capped revision count where comments ran away, a monthly retainer where the fragmentation was the problem.
Freelancers who track profitability do not mostly end up with fewer clients. They end up with the same clients on different terms, which is the outcome that pays for the tracking.
Start the timer instead of reading about it
The demo is the real product with example data in it. No account, nothing to install, and anything you add you can keep when you sign up.
No account to look around. Example data, and anything you add is yours to keep.
Questions
Should I include my own admin time in a project?
Include admin that belongs to that project — its calls, its emails, its invoicing. Exclude your general business admin, which belongs to no project and would distort the comparison between them.
How do I split shared expenses across projects?
Do not, unless the amount is large. A €12 monthly subscription split five ways adds noise, not insight. Attribute direct costs — the subcontractor, the licence bought for this job — and leave general overheads out of per-project profit.
What is a good effective hourly rate?
Compare it to your own target rate, not to anyone else's. If your break-even is €62 an hour and your target is €85, a project delivering €58 is genuinely losing money and one delivering €145 is subsidising it.
Does Flowzivo calculate this automatically?
Yes, once hours, invoices and expenses carry a project. Each project card shows invoiced, hours, profit and margin, and flags the ones over budget or over hours. Nothing is estimated — the figures are the documents you already created.