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Methodology

Billable Utilisation Planner methodology

This planner allocates annual team time into non-billable and deliverable capacity, then optionally estimates revenue capacity at a user-entered rate.
Duc Nguyen X.By Duc Nguyen X.· Founder, Margin101Last reviewed: View update historyMethodology

Educational only: Business decision support, not accounting, tax or legal advice.

Privacy: Calculations run locally; Margin101 does not receive your commercial inputs.

Update policy: Reviewed when formulas or official dependencies change.

Scope: Market-neutral small-business planning using your own assumptions.

1. Formulas and units

Gross available hours
G = N × W × H

Where

N
team members (people)Source: Business record
W, H
working weeks and hours per week (weeks/year and hours/week)Source: User assumption
G
gross available hours (hours/year)Source: Calculated output
Available before seasonality
B = G − N × W × (A + S + I) − N × L

Where

N
team members (people)Source: Business record
W, H
working weeks and hours per week (weeks/year and hours/week)Source: User assumption
A, S, I, L
admin, sales, internal, leave and shutdown time (hours)Source: User assumption
G
gross available hours (hours/year)Source: Calculated output
B
available before seasonality (hours/year)Source: Calculated output
Deliverable hours
D = B × s

Where

s
seasonality capacity factor (decimal)Source: User assumption
B
available before seasonality (hours/year)Source: Calculated output
D
deliverable hours (hours/year)Source: Calculated output
Billable utilisation
u = D ÷ G

Where

u
billable utilisation (decimal)Source: Calculated output
G
gross available hours (hours/year)Source: Calculated output
D
deliverable hours (hours/year)Source: Calculated output
Revenue capacity
R = D × r

Where

D
deliverable hours (hours/year)Source: Calculated output
r
hourly rate excluding indirect tax (currency units/hour)Source: Business record
R
revenue capacity (currency units/year)Source: Calculated output

Money inputs and outputs use the currency selected in the scenario without changing the canonical methodology. Rates, margins, utilisation and buffers are entered as percentages and converted to decimal values for calculation.

2. Worked example

Input assumptions

Two people × 48 weeks × 38 hours gives 3,648 gross hours. Weekly non-billable allocation totals 1,248 hours, leaving 2,400 before seasonality.

Calculation and outputs

Example

Two people × 48 weeks × 38 hours gives 3,648 gross hours. Weekly non-billable allocation totals 1,248 hours, leaving 2,400 before seasonality.

Gross hours
3648.00 hours
Weekly non-billable
1248.00 hours
Before seasonality
2400.00 hours
Deliverable hours
2160.00 hours
Billable utilisation
59.21%
Revenue capacity
324,000.00 currency units

At a 90% seasonality factor, deliverable capacity is 2,160 hours, utilisation 59.21% and revenue capacity 324,000 currency units at 150 currency units/hour.

Interpretation

Use the billable-time result as a realistic capacity boundary after non-billable work, not as a target for every week.

3. Validation and boundary checks

  • Every hour reconciles between gross, deliverable and non-billable capacity.
  • Lower non-billable time cannot reduce deliverable capacity.
  • Allocations that exceed gross capacity return an unreachable result; equality returns zero deliverable capacity.

4. Assumptions and source classification

  • Team size, weeks, hours, time allocations, seasonality and rate are user supplied.
  • The utilisation denominator is gross capacity before non-billable allocations.
  • No employment entitlement or industry utilisation benchmark is used.

This planner has no current policy-data dependency. Its commercial assumptions are user supplied. Registered family-level regression suites exercise the shared business-logic engine and worked-result reconciliation.

5. Limitations

  • The model excludes demand, pipeline, payroll, loaded labour cost, awards, overtime and productivity quality.
  • It is educational capacity planning, not business, employment, accounting or tax advice.

This is educational decision support, not tax, accounting, legal or financial advice. Check the treatment of your actual transactions under the rules that apply to your business and seek qualified advice where appropriate.

6. Update and evidence policy

Registered family-level suites test formula invariants and example reconciliation; the release ledger records that coverage without claiming a separate oracle for every line of public copy. There is no official threshold or benchmark to refresh for this planner. Commercial inputs remain user-supplied because they vary by business and contract.

Change history

  1. : Initial public release of the planner and methodology after pre-launch calculation, content, source and interaction review.

Related reading

Guides to interpret the decision and its assumptions.

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