<div class="gn-article"><div class="gn-hero gn-reveal"> <div class="gn-hero__image"><img src="https://cdn.prod.website-files.com/687a235da6861294eec73166/69089aa04f0cac54eb50ec1d_651d7ec9912ce39a76f3a37a_61bcb819801663bbc92350b2_Blog%252520covers%252520(33)%252520(1).png" alt=""></div> <div class="gn-hero__head"> <span class="gn-kicker"><span class="dot"></span>Event · Expression</span> <h1 class="gn-title">Agency Workshop: Planning for Profit</h1> <div class="gn-meta"> <strong>The GO Network</strong> <span class="pip"></span> <span>20 July 2022</span> <span class="pip"></span> <span>1 min read</span> </div> </div> </div> <div class="gn-event-meta gn-reveal"><div class="gn-event-meta__block"> <span class="gn-event-meta__label">When</span> <span class="gn-event-meta__value gn-date">Wed, 20 Jul 2022 · 09:00</span> </div><div class="gn-event-meta__block"> <span class="gn-event-meta__label">Where</span> <span class="gn-event-meta__value">Online</span> </div><div class="gn-event-meta__block"> <span class="gn-event-meta__label">Status</span> <span class="gn-event-status gn-event-status--recording">Past · Recording</span> </div></div> <div class="gn-body"> <h2>Why Fast-Growth Agencies Lose Sight of Profit (And How to Get It Back)</h2> <p>Growing an agency and running a profitable one are not the same thing. Many agency owners discover this the hard way: revenue climbs, headcount expands, the client roster fills up, and yet the numbers at the bottom of the P&amp;L refuse to follow. The busier the agency gets, the harder it becomes to understand where the money is actually going.</p> <p>This is the central problem that Rory Spence of <strong>The Wow Company</strong>, a specialist accountancy firm working with creative and marketing agencies, addressed in the first session of a profit-building series run through <strong>The GO Network</strong>. The session, aimed squarely at agency owners looking to scale sustainably, focused on the foundational stage of any profitability strategy: planning for profit before you expect it to appear.</p> <p>The core argument is straightforward. Profit does not emerge as a natural by-product of winning more business. It has to be designed into the way an agency operates. Without a deliberate plan, growth tends to erode margins rather than strengthen them, as overheads rise, billing discipline slips, and capacity is consistently underestimated.</p> <h2>Start With Where You Actually Stand</h2> <p>The first step in planning for profit is an honest assessment of your current position. That means establishing two things clearly: what your profit margins look like right now, and what good should look like for an agency of your type and size.</p> <p>Goal-setting without benchmarking is guesswork. Agency owners frequently set revenue targets without any reference to what industry-standard margins are for their sector, their headcount, or their service mix. The result is targets that feel ambitious but are disconnected from operational reality.</p> <p>Benchmarking gives you a reference point. It tells you whether a 12% net profit margin is a reasonable near-term goal or a significant stretch. It tells you how your staff costs as a percentage of revenue compare to agencies doing similar work. Without this context, there is no way to know whether the plan you are building is credible.</p> <p>The practical action here is to pull together a clear picture of your margins at each level: gross profit after direct costs, operating profit after overheads, and net profit after everything else. Many agency owners are surprised to find these numbers diverge significantly from their intuitions about how the business is performing.</p> <h2>Understand Your Real Billing Capacity</h2> <p>One of the most common sources of margin erosion in agencies is a mismatch between assumed capacity and actual billable output. Agencies plan their revenue targets based on headcount, then find that a significant proportion of available time never converts into billed work.</p> <p>Realistically assessing billing capacity means accounting for everything that competes with billable time: new business development, internal meetings, training, admin, holiday, and sickness. A full-time employee does not represent 40 billable hours per week. In most agencies, the realistic billable utilisation rate for client-facing staff sits considerably lower than owners assume when building their revenue plans.</p> <p>The gap between assumed and actual capacity is one of the primary reasons agencies consistently fall short of revenue targets despite appearing to have enough people and enough work. Closing that gap starts with measuring it accurately, then building plans that reflect reality rather than optimistic projections.</p> <p>A useful exercise is to map out your current team's time across a typical month, separating billable from non-billable activity. This single step often reveals both where capacity is being lost and where there is room to recover it.</p> <h2>Trace Where the Profit Is Going</h2> <p>Even agencies with reasonable gross margins can see profit disappear before it reaches the bottom line. Understanding where profit goes requires looking at the structure of your costs with some precision.</p> <p>Common culprits include scope creep that is never recouped through additional billing, underpriced retainers that made sense at the time of signing but have not been reviewed as the scope of work has grown, and overhead structures that expanded during a period of revenue growth but were never rationalised when growth slowed.</p> <p>There is also the question of which clients and which services are actually contributing to profit, and which are consuming resource without adequate return. Not all revenue is equal. An agency carrying several loss-making or margin-diluting clients alongside its profitable work will struggle to improve its overall position without addressing the mix.</p> <p>Tracking profitability at the client or project level, rather than only at the agency level, gives you the information you need to make decisions about pricing, resourcing, and which relationships are worth investing in.</p> <h2>Build a Structured Plan, Not a Target</h2> <p>Setting a profit target and building a profit plan are different things. A target is a number. A plan is a set of specific actions, tied to a timeline, that explain how the agency will move from its current position to the desired one.</p> <p>A structured profit plan for an agency typically covers: the margin improvement required, the levers available to achieve it (pricing, utilisation, cost control, or client mix), the timeframe over which changes will take effect, and the metrics that will confirm progress.</p> <p>Without this structure, profit improvement tends to remain an intention rather than an outcome. The plan does not need to be complex, but it does need to be specific enough that the people responsible for executing it know exactly what they are doing and why.</p> <p>If your agency does not have a documented profit plan, building one is the most valuable thing you can do before the next financial year begins. The Wow Company's work with agencies of all sizes consistently points to planning as the single biggest differentiator between agencies that grow profitably and those that simply grow.</p> </div></div> <aside class="gn-related gn-reveal" data-auto="related-reading"> <div class="gn-related__label">Related reading</div> <ul class="gn-related__list"> <li class="gn-related__item"> <a href="/articles/agency-workshop-pricing-for-profit" class="gn-related__link"> <span class="gn-related__category">Expression</span> <span class="gn-related__title">Agency Workshop: Pricing for Profit</span> <span class="gn-related__excerpt">Wow Company&#39;s Benchpress data reveals how top-performing agencies set hourly rates and fees, so you can benchmark your pricing and close mor</span> </a> </li> <li class="gn-related__item"> <a href="/articles/agency-workshop-making-2022-your-most-profitable-year-yet" class="gn-related__link"> <span class="gn-related__category">Expression</span> <span class="gn-related__title">Agency Workshop: Making 2022 your most profitable year yet</span> <span class="gn-related__excerpt">Wow Company joins The GO Network to share Benchpress survey insights, peer discussion, and practical tips for building a more profitable, su</span> </a> </li> <li class="gn-related__item"> <a href="/articles/agency-workshop-building-a-profit-culture" class="gn-related__link"> <span class="gn-related__category">Expression</span> <span class="gn-related__title">Agency Workshop: Building a &#39;Profit Culture&#39;</span> <span class="gn-related__excerpt">Access this recorded agency workshop on building profit culture: tactics to incentivise staff, drive profit-thinking, and get your whole tea</span> </a> </li> <li class="gn-related__item"> <a href="/articles/10-key-elements-to-maximise-website-engagement" class="gn-related__link"> <span class="gn-related__category">Expression</span> <span class="gn-related__title">10 Key Elements to Maximise Website Engagement, by WebBox</span> <span class="gn-related__excerpt">WebBox&#39;s Sean walks agency owners through 10 actionable UX and conversion rate fixes you can apply to your agency site in under 30 minutes.</span> </a> </li> </ul> </aside>