Money Leaks: 10 Ways You’re Sabotaging Profits Without Realizing It

Stressed woman with notebooks and laptop around her

Everything we do in client services needs to tie back to profitability. Otherwise, what’s the point?

Of course we want to help people — but nobody gets into business to live paycheck to paycheck. Our goal is to grow our agency. But we’re often so busy putting out fires and interacting with clients that our business accidentally leaks profitability.

Here are 10 ways your business is losing money (with a secret bonus tip at the end)!

1. Inaccurate estimating​

Inaccurately estimating the product or service you’re going to deliver will lose you profits. Often, this is a result of not doing enough discovery to understand the real scope of the project. During the discovery phase, it’s important to peel back the layers and find out everything the client needs.

What’s more, this will help you account for the exact work you were hired for, not just what you think it may be. Your time is important so you should be charging for project management. Account management. Tax management. Internal communication.

All these aspects, and more, need to be time-tracked, accounted for and billed.

The Fix: Include everything​

When making your estimates, include:

  • The work and deliverables
  • Project management
  • Client service and care
  • Administrative tasks

Remember — time is money. Tracking it is one of the best ways to boost your profitability.

2. Using the wrong rate​

This next common issue is closely tied to inaccurate estimation. Specifically, you’re probably not accounting for all business expenses. When deciding on our hourly rates, it’s important to account for all expenses that are involved in delivering the product. Many freelancers or agencies figure out their own rate simply by finding out what others charge.

This is a sure way to not bill for what you’re worth, sabotaging margins and profits in the process. When calculating the price of a project, you need to know your minimum acceptable hourly rate to cover all expenses, salaries and profits.

The Fix: Get the math right​

Using effective, fair pricing, you can:

  • Take all expenses, salaries and profits into account
  • Create a rate card with base pricing for your most common services
Man covering his eyes with his hands

3. Hidden messes​

Despite appearances, not all projects are the same! When dealing with websites you didn’t build, there’s no knowing what you’re getting yourself into. The fact of the matter is, existing site code might be a complete mess.

Just as a mechanic looks under the hood of a used car before you buy it, you should take the time to investigate the code. And a quick look is not enough. When investigating any hidden messes, you need to take the appropriate time to really understand what you’re dealing with.

And charge accordingly.

If this is outside your skillset as an agency owner, there’s no need to worry. You can always outsource this particular issue by hiring a full-time developer on your team.

The Fix: Technical assessment​

To know what you’re getting into you should:

  • Identify and prioritize problem areas
  • Provide a report/roadmap to bring the site up to your quality standard
  • Establish a baseline foundation

4. Siloed design process​

During the design phase, you are looking at maximum collaboration and interaction with others. The problem is that too many designers do too much work without getting the client involved.

In the end, you go too far and don’t explain your design thinking to the client. What this does is it introduces erosion of your hourly rate. As feedback mounts or wavelengths are crossed, the only outcomes are frustration and expense.

The Fix: Include the client​

During the design process you should:

  • Get the client involved as much as possible
  • Request feedback early in the process
  • Present and explain your work for every deliverable

5. Revision management​

In essence, poor revision management comes from poor communication and following a reactive rather than proactive approach. To grow your agency, you should always be on the lookout for potential issues and communicate them as soon as possible.

Another issue is scope creep, which can be frustrating for service providers. But it’s not the client’s fault. It’s the result of poor revision management. Take this into account so your pricing is adjusted as the scope of the work changes.

The Fix: Be a proactive leader​

Guide the client throughout the process by:

  • Explaining everything multiple times
  • Actively guiding the project forward
  • Providing clear instructions
  • Using change orders

6. Forgetting the client​

This may seem crazy at first. After all, we’re in client services. But the problem is that once we leave design and enter the development process, the client is often left on their own to meet deadlines.

When this happens, everything gets delayed. The clients have other priorities and they procrastinate, which has a knock-on effect on the overall project. And as we’ve learned before, time is money.

You end up losing both.

The Fix: Support the client​

As with many of the previous problems, much of this can be solved with proactive management and top communication. Remember to:

  • Provide tips tools and resources to help the client
  • Communicate often with the client to keep them on track
Lab technicians in white coats looking at test tubes

7. Not testing work​

When you don’t check as you go, you can end up pushing code that’s littered with bugs and errors. And since it’s you who created the code, it’s your responsibility to fix any errors — even if it isn’t built into your schedule.

After all, do you usually block out time to fix issues after launch?

As you may expect, bugs and errors mean extra time, which is often unplanned and unpaid. Once again, we’re eroding profit by spending unplanned time to bring our work up to scratch.

Remember, most people overestimate how much they can get done and underestimate how long it takes. This is at the heart of the issue.

The Fix: Check your work​

Here are some key best practices to grow your agency and build extra margin into your projects:

  • Include time for proper quality analysis when estimating projects
  • Test your work as you go — not just at the end
  • Consider involving the client in UAT (User Acceptance Testing)

8. No recurring revenue​

How many of you only focus on one-and-done projects? Get a project. Do it. Done. It may be nice to get that sense of closure but you’re potentially losing out on fruitful collaboration.

This means actively providing the opportunity for ongoing collaboration with the clients instead of just pushing them out the door. By not doing this, you are putting undue pressure on yourself to keep finding a fresh supply of new clients and pay those monthly bills.

As most small business owners know, this can be crushing.

With recurring revenue, you are better able to forecast your financial future and have that all-important peace of mind.

The Fix: Support services​

Support yourself by supporting others. By offering monthly website support, you can:

  • Diversify your income stream with reliable recurring revenue
  • Reduce the pressure to generate new one-off website projects

9. Ignoring client FOMO​

When things are “out of sight out of mind,” it is a disadvantage for you. What’s more, the “I don’t care until it affects me directly” mentality will block new sales.

What does this mean? Jennifer Bourn explains it best:

“If made to decide between gaining $100 or not losing $100, most people will choose to avoid losing money. Client outreach can’t just focus on the benefits of a ‘yes,’ it must also address the potential risks of a ‘no’.”

By pairing a client’s potential benefits with their potential risks, these two factors combined can be very powerful and persuasive.

The Fix: Well-timed reminders​

With well-timed reminders, you can point out what could have been done differently, such as:

  • Reminding the client of benefits they’re missing out on
  • Mentioning how others are using the refused offer to great benefit

10. Poor follow up​

Here’s the problem. Full schedules and heavy workloads have business owners running ragged. When we are busy trying to grow our agency, follow up either doesn’t happen or is inconsistent, low quality or cuts off too soon.

Just because the client or lead refuses at first, it does not mean it’s time to stop following up. Often, it means “not right now” because they, like you, have a lot of work to contend with.

There is always room to reconnect, touch base or just say hello. Whatever it might be, don’t give up too soon. Otherwise, you’re leaving money on the table.

The Fix: Develop a follow-up system​

By developing a repeatable follow-up system, you can:

  • Ensure nothing is left to chance or falls by the wayside
  • Document your processes, create messaging templates and make it easy

Find this advice useful?

These 10 profit-saving tips are based on a webinar given by Jennifer Bourn to help you grow your agency. Check out the full webinar that took place live in the Niche Agency Owners Community on January 19 to see the bonus tip!

The Niche Agency Owners group is a community of like-minded entrepreneurs looking to grow in their own niche. Join now and discover a thriving space full of resources, tools and peer-to-peer advice.


You’ll be joining a community of highly-vetted digital agencies and web professionals with one common goal — growth! Learn more. 


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  • Daily security scans and malware cleanup
  • Maintenance dashboard
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