March 10th, 2010
After 15 years working with creative businesses and 7 years conducting agency reviews, we’ve learnt that there is ONE single thing that must be accurate in your business for you to generate a healthy profit from your creative ideas. That one thing is your ‘charge out rates’.
So many creative agencies get this wrong and over time it can be a huge drain on your business and its profit potential.
The real challenge then becomes knowing what you ’should’ or ‘could’ be charging for each type of creative service you provide. How can you benchmark your rates against other players in the industry that are of a similar size, nature and operate in the same locality? No other agency is going to readily share information about their charge out rates with you – are they?
Well, we’ve made it really simple for you. Tick Boxer has undertaken an independent review of 65 plus agency rate types across the Australian creative industry to benchmark, for the first time ever, what the standard charge out rates are for agencies at three different strategic levels or tiers across the industry.
Would you like to know how your rates compare to the rest of the market? Well you can by taking our Free Agency Rates Assessment which will give you a FREE evaluation telling you whether your head hour rates are below, within or above the market range for your type of business.
In your assessment you can choose to benchmark yourself against a number of core categories including Management & Account Service, Strategic Planning, Creative & Design, Digital, Production and Studio.
This is a first of its kind report and if you complete your own personalised assessment before March 31st 2010 you will go into a draw to receive one of 5 iPod nano’s.
Assess your rates today to pin point exactly where your rates sit in the creative industry. Find out how to complete the Free Agency Rates Assessment now.
Photo: kindly borrowed from SkitterzPRO on Flickr (http://www.flickr.com/photos/photoshopmagic/3119874338/)
Posted in Charge Models, Charge Out Rates, Rates Assessment | No Comments »
March 5th, 2010
Every Creative business needs to think about the most effective way to create profits from the work they do. Where should you start first and what is the simplest way to know if you are billing as much revenue as you could be? You certainly don’t need to have a fancy accounting system to tell you whether you are getting this right.
There are three basic calculations you need to work out. Check them out as this could be the difference between making a profit in 2010 or just getting by…
Step 1. Figure out how much $ you should be billing based on the people in your business. E.g. John Smith should be billable to a client at least 30 hours of his working week. Ensure you work out everyone’s billable time and this becomes your TARGET revenue. Remember that some roles are less billable or not at all.
Step 2. Each week, log how much time everyone said they DID work that week. E.g. John Smith said he clocked up 25 hours against clients this week. This is your NOTIONAL revenue (ie what you should have billed to the client). It is best to get your staff to keep timesheets no matter how painful!
Step 3. Establish how much $ you did BILL to your clients that week/month. This is your ACTUAL revenue.
Simply compare your TARGET v NOTIONAL v ACTUAL revenue. What’s the goal? Keep aiming to get your ACTUAL closer to your TARGET. This will build your profits over time.
Where can I get hold of a tool that helps me with this? For those of you who want to measure this easily and quickly, we have created the perfect and simple spreadsheet that lets you track your target, notional and actual (weekly and monthly) revenue. All you need to do is spend 15 minutes per week updating the time spent on clients to receive the most important report you can do in your business.
Check out our Staff Utilisation Report available for only $250.
Photo: kindly borrowed from Gennerobot on Flickr (http://www.flickr.com/photos/ginnerobot/2976270292/)
Posted in Managing Profits, Performance Management, Staff Utilisation | No Comments »
March 1st, 2010
Do you have freelancers working in your business? Remember to ensure you have clear contracts with any freelance creative personnel that clearly states that your business owns the intellectual property (IP) created.
Under moral rights law the individual that scribbles or sketches a creative idea owns that idea up until 50 years after their death.
A full time employee working in a company is covered, but a freelance creative person owns their IP automatically by law, unless you clearly state otherwise in their contract.
Photo: kindly borrowed from Dartar on Flickr (http://www.flickr.com/photos/dartar/1091633474/)
Posted in Contracts, Freelance Staff, Intellectual Property (IP) | No Comments »
February 5th, 2010
How do you ensure that all your creative efforts are rewarded by way of a healthy, profitable business? We give you key insights and practical solutions to ensure your projects and accounts are not only providing winning outcomes for your clients but for you and your business also.
After years teaching an Agency Profitability course for the Australian Federation of Advertising (AFA) (now the Communications Council) as well as through many of her own Adtopia training seminars, Debbie Pine shares her insights into the mix of activities you need to get right to ensure your agency stays on the road to profitablility.
Tags: Charging Models, Estimating, Profitability
Posted in Charge Models, Performance Management | No Comments »
January 19th, 2010
When setting KPO’s (performance objectives) for your team – remember to think about including an objective from each of the 5 key categories to ensure their skills are developed and rounded off.
They include:
- communication (internal or external)
- procedural
- technical
- financial (revenue/sales/extraction)
- reporting (analyzing data whether it be qualitative or quantitative from the business and providing that up the chain)
For more help and advise contact the Tick Boxer team.
Tags: KPO's, Performance Measures
Posted in Performance Management | 1 Comment »