M1
Agency Profit Margin Benchmarks by Revenue Band
Understand what profit margins are industry standard by revenue bandsModule 1 of 10 · Agency Profit Engine
Most agency owners don't have a profit target. They have a revenue goal and a hope that something's left over.
Goal
Understand what profit margins are industry standard by revenue bands.
Benchmarks: Operating Profit After Payroll, Before Owner Distributions
| Revenue Range | Operating Profit % | Your Number |
|---|---|---|
| $300K–$600K | 10–15% | |
| $600K–$1.2M | 15–20% | |
| $1.2M–$3M | 18–25% |
Decision Rules
- profit is below range: freeze hiring, reduce software, double down on business development
- profit is within range: maintain pace
- profit is above range: increase owner distributions or reinvest
Tradeoffs
Higher profit = slower growth, lower risk. Lower profit = faster growth, higher stress.
Bonus
Agency Financial OS Calculator
Google Sheets: apply the system to your own agency in minutesA companion Google Sheet runs the math from Modules 1 to 6 automatically. Enter your numbers, get your targets.
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