Do you know how much your internal projects cost you?

We do and the numbers are intriguing

Nearly every company works on internal projects. I know a lot of people who run a business similar to 2FRESH, but not all of them keep track of costs of their unbillable projects. I do care about these numbers. That’s why we use Costlocker for following such projects, and we’ve already got the numbers in question. They’re very interesting.

At the beginning of the year, we started working on a new version of our company website. So far — from January 6th 2014 until today, March 4th — the creation of the new 2FRESH website has cost us CZK 241,795 (approximately USD 12,090). And we’ve only a third way through the project.

On January 20th 2014, we added and put in place a project named “Emails”. It’s a project under which we track time that can’t be linked to any client project. Until today, we’ve recorded time worth CZK 72,918 (USD 3,646). If I take into account that January 20th till March 4th translates as 32 working days, then a day spent on dealing with emails costs us CZK 2,279 (USD 114). There’s some 252 working days in 2014, if I’m right. So in the year of 2014, this activity should cost us CZK 574,308 (USD 28,715). It really is an interesting number, isn’t it.

Let’s have a look at our last pitch, a pitch for cat food. It cost us CZK 46,404 (USD 2,320). And if we charged a client for that, it would be CZK 191,621 (USD 9,581). Some may say that the lost revenue is a misleading criterion, anyway, I like monitoring this kind of indicators. During the year, we’re going to be in several pitches for new clients. And we definitely won’t be successful in all of them. Thanks to these metrics I can find out how much an acquisition of a new client costs us. When I define our goals for the next year, I can factor this in the next year budget.

In addition to this, we’ve added a project called “Client Care” to each of our clients, under which we track the time that can’t be assigned to any project of a particular client. Do you think I’ve gone insane? I haven’t. Do you know how much this kind of activities cost you? I can tell you exactly how much they cost us. It’s CZK 52,042 (USD 2,602), from January 20th till March 4th. If I consider it our lost revenue, then it would be CZK 115,909 (USD 5,795). These are numbers based on 6 clients and 32 working days. So, it’s some CZK 1,626 (USD 81) a day, in average. And again, we’re at CZK 409,752 (USD 20,488) for the whole year.

These cases show only two examples where you can generate costs. It’s important to tell your colleagues about that, which shouldn’t result in worsening your client care or stopping replying on emails. It should make you become conscious of the costs of these activities. And that any improvement in these areas will make your company healthier and stronger, because you get more time and money to reinvest back in your company. What about going on holiday with all of your colleagues?