Financial Benefits of Using JobBag

JobBag has a unique approach to capturing, measuring and managing the business process of a marketing agency. The tools and seamless integration that we provide make the business of running and managing jobs an order to magnitude easier and more intuitive than what you currently have with your current system.

At the end of the day, JobBag is about maximising revenue and profit. JobBag has the ability to show you so much about the potential of your business and why you aren’t reaching it. 

Consider this – one of the key reasons why our clients choose JobBag is the payback JobBag produces.  You don’t get a one off benefit with JobBag, you get ongoing benefits through improvements in efficiency, billings and profitability year after year.

What follows is an analysis of the estimated benefits from just 3 of JobBag’s unique features that we believe are unequalled by any other system. All examples in this analysis are based on the information in the following table; it contains the key parameters used in our examples that we believe might be appropriate for a business of approximately your size.

Revenue generating employees

30

Percentage of chargeable time *

70%

Billable hours per year per employee

1,260

Average hourly charge rate

$110

Estimated time billings

$4,158,000

(*) Note: 70% chargeable time is not extraordinary, but is certainly reasonable. In reality, the chargeability percentage should be higher for most employees

Client Utilisation and Authors Corrections

Imagine having instant feedback on client servicing – how much are you really putting into your clients that is not being returned in billings? Aggregate that up to the client level and you get instant analysis of which clients are costing you money. Then take that down to the job level and find out why – is it the client, your process or your employees? Once you know why, you can work on improving the result. This is instantly available in JobBag at the client level and at the job and task level.

One of the critical areas of over servicing is in Authors’ Corrections – changes requested by the client outside the brief and generally chargeable over the initial estimate provided. Mostly these changes are unidentifiable in other systems or are clumsily lumped into one bucket.

JobBag gives you the tools to identify the changes, to document them and communicate them to the client and your team. You can set budgets for changes in a few seconds, track the changes and automatically include the chargeable value and the reasons in the invoice you send to the client. Your Account Service team are going to be amazed at how easy it is to manage their jobs and improve their billings with JobBag.

If only 1% of billable time from our table above was returned through higher billings through author’s corrections, your billings would increase by $41,580. Our clients normally improve their billing of authors corrections by significantly more than this percentage.

Visual Traffic

The primary objective of any creative agency is to get the job done on time, on brief and on budget. The key to on time and on budget is effective job management and resource utilisation. The way to achieve this is communicating clear expectations both to clients and team members, planning for success and managing the results as they happen.

JobBag v6 introduces a traffic and planning system that we believe is unparalleled by any other system.  JobBag’s Visual Traffic system gives your staff a planning, budgeting and task management system that is so integrated, it takes less effort to run that you could ever imagine.

The key benefit of this system is that it is easier to predict when additional resources are required through bottlenecks and competing deadlines, its easier to see when jobs are potentially going over budget and be able to respond to that challenge (authors corrections?), and its easier for all involved in a job to see what is going on and manage the job more effectively.

Improved job management leads to higher profits through less un-billable time and greater utilisation of the available billable hours (i.e. Not going over budget, therefore delivering on time and on budget). You will also increase the billable percentage of time for existing employees.

If all you saved in 1 year was 1%, you would eliminate going over budget by another $41,580.  This is not a one off benefit, this continues every year you use JobBag.

Requests for Quotes (RFQs), Purchase Orders and Estimates

Lost revenue due to unbilled supplier invoices costs an agency dearly every year; every dollar of unbilled costs comes straight off your Operating Profit Before Tax. The tragedy of most systems is that most of this is invisible and you don’t even know you are losing it, or the process for managing this is so labour intensive it is costing you money to do it.

There is a simple but powerful link in JobBag between Request for Quotes, Purchase Orders (for suppliers) and Estimates (for clients) that makes unbilled external costs impossible and improves your understanding of what is happening on the job. On top of that is the increased efficiency of everyone involved in managing the job, and improved financial reporting through the WIP & Accruals system.

Reducing unbilled external costs by 2% would increase your profit by at least $10,000 on $500,000 costs incurred each year.  Add to that a mark-up of 25% and you have added $12,500 to your profit. 

Summary of the benefits

In summary, if you enjoy just the modest benefits above, the impact on your profitability will be:

Client Utilisation                   $41,580

On Budget performance        $41,580

Billing unbilled costs            $12,500

Total                                          $95,660

All of the examples (and there are more) are based on small incremental improvements to some key areas of your business. Our assumptions might vary slightly to your charge rates and billable hours, but you can easily replace our rates for your own and then see the impact.

Then ask the question “Are you actually achieving that level of billings from your employees’ time?”

JobBag is going to make you more profitable by a factor that far outweighs the costs, and that improvement in profitability will be ongoing.  We do it with every client that we work with.

We hope you find the above illuminating. We look forward to talking further as we develop the model that will work best for you.


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