Rex says
Money math without the spreadsheet headache. Plug in your numbers and I'll show you exactly where the dollars land.
Try a scenario
Click to load — tweak from there.Inputs
All payroll + overhead, including non-billable staff
Result
Utilization needed for target profit
73.3%
Break-even utilization
58.9%
Total available hours
960
Billable hours required
703
Revenue required
$102,000
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Got your number — what next?
Pick one, it takes 20 secondsHow to use this
- 1Enter delivery headcount (people).
- 2Enter available hours per person per month (hrs).
- 3Enter average bill rate ($/hr).
- 4Enter total monthly cost base ($) — All payroll + overhead, including non-billable staff.
- 5Enter target monthly profit ($).
- 6Read your utilization needed for target profit on the right — it updates as you type.
- 7Hit Share to keep the scenario or send it to someone.
About this calculator
Utilization is billable hours divided by available hours, and it's the single lever that decides whether a services business is profitable at a given headcount. This calculator works backwards: given your fully loaded monthly cost base, your bill rate, and the hours your delivery team has available, it returns the utilization percentage required to break even and the utilization required to hit your target profit. Agencies typically target 70-80% for delivery staff and 40-60% for player-coach leads. Anything above 85% sustained is a burnout and quality signal, not a win — it leaves no slack for training, pitching, or the inevitable rework.
Worked example
Using the values the calculator loads with:
Inputs
- Delivery headcount: 6 people
- Available hours per person per month: 160 hrs
- Average bill rate: 145 $/hr
- Total monthly cost base: 82000 $
- Target monthly profit: 20000 $
Results
- Utilization needed for target profit: 73.3%
- Break-even utilization: 58.9%
- Total available hours: 960
- Billable hours required: 703.45
- Revenue required: $102,000.00
What each field means
Inputs
- Delivery headcount (people)
- The delivery headcount used in the calculation, measured in people. Starts at 6 people so you have a working example on load.
- Available hours per person per month (hrs)
- The available hours per person per month used in the calculation, measured in hrs. Starts at 160 hrs so you have a working example on load.
- Average bill rate ($/hr)
- The average bill rate used in the calculation, measured in $/hr. Starts at 145 $/hr so you have a working example on load.
- Total monthly cost base ($)
- All payroll + overhead, including non-billable staff
- Target monthly profit ($)
- The target monthly profit used in the calculation, measured in $. Starts at 20000 $ so you have a working example on load.
Results
- Utilization needed for target profit
- Returned as a percentage and shown as the headline result. It recalculates instantly whenever you change an input, so you can compare scenarios without reloading.
- Break-even utilization
- Returned as a percentage. It recalculates instantly whenever you change an input, so you can compare scenarios without reloading.
- Total available hours
- Returned as a whole number. It recalculates instantly whenever you change an input, so you can compare scenarios without reloading.
- Billable hours required
- Returned as a whole number. It recalculates instantly whenever you change an input, so you can compare scenarios without reloading.
- Revenue required
- Returned as a money amount in US dollars. It recalculates instantly whenever you change an input, so you can compare scenarios without reloading.
FAQ
What utilization should I actually target?
70-80% for individual contributors on delivery, 50-60% for leads who also sell or manage, and 0-25% for principals. Above 85% you lose the slack needed for onboarding, process work, and pitch support, and quality problems usually show up within a quarter.
Does a target above 100% mean the model is broken?
Yes — it means you cannot cover cost at that headcount and bill rate even if every hour is billed. The fix is one of three levers: raise the rate, cut the cost base, or shift the mix toward cheaper delivery labor. No amount of scheduling discipline fixes it.
Should PTO be in available hours?
No. Subtract holidays, PTO, and statutory leave before you count available hours, otherwise your utilization looks artificially bad every August and December. Most agencies use 1,800-1,880 available hours per year, or roughly 150-157 per month.
How does this differ from realization rate?
Utilization measures how much time got billed; realization measures how much of what was billed actually got collected at full rate after write-offs and discounts. You can hit 80% utilization and still lose money if realization is 70% — track both.
Accuracy and limitations
- Results are estimates before tax, fees, and inflation unless an input explicitly covers them.
- Rates are treated as fixed for the whole period — variable-rate products will drift from this projection.
- This is educational maths, not financial advice. Check anything contractual with the lender or your accountant.
Related tools
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Agency Hiring Capacity Calculator
Work out when your booked pipeline forces the next delivery hire.
Cite this calculator
Writing about this topic? Grab a citation — every link helps keep these tools free.
RevenueLab. (2026). Agency Utilization Rate Target Calculator. Retrieved from https://www.revenuelab.fyi/toolbox/agency-utilization-target
<p>Source: <a href="https://www.revenuelab.fyi/toolbox/agency-utilization-target" target="_blank" rel="noopener">Agency Utilization Rate Target Calculator — RevenueLab</a> (2026).</p>
Source: [Agency Utilization Rate Target Calculator — RevenueLab](https://www.revenuelab.fyi/toolbox/agency-utilization-target) (2026).