This article describes functionality of our new project module. This module is being rolled out gradually, so it is possible you do not have access to the features described here yet. If that is the case, you can still find documentation on the previous project module here.
In managing projects, having a clear financial overview is essential for ensuring profitability, controlling costs, and maintaining transparency with clients. This article explains the key financial terms and calculations used in Teamleader Focus to monitor and report on project finances.
In this article:
1. Price
The total amount that the customer will be invoiced for. This includes:
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Time & Material (T&M): Work performed so far, calculated using external hourly or unit rates.
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Fixed Price: Pre-agreed prices for specific project deliverables.
Both T&M and Fixed Price amounts are shown together to reflect the full billing amount.
2. Cost
The total internal expenses incurred for the project, based on:
Important:
- Costs increase as time and materials are added.
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All costs (including Fixed Price materials) are included.
3. Margin (Profitability)
The project’s profit, calculated as:
Margin = Price – Cost
- Shows how much profit is made after covering internal costs
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Provides insight into the financial performance of the project
4. Budget
The maximum agreed amount that the customer may be invoiced for the entire project.
- Manually set at the overall project level, or in the case of linking a quotation or deal to a project this budget is either taken over, replaced or added to the project budget.
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Can also be defined at group or line levels for more detailed control.
5. Budget spent
The part of the customer budget that has already been used, based on actual work performed.
Calculation:
- Time & material amounts are calculated at external rates and added to ‘budget spent’.
- Fixed price: the total ‘price’ defined in fixed price groups isn’t added to ‘budget spent’, but the costs of time tracking and materials (calculated at external rates) are added for consistent tracking. If your project incurred higher costs than its fixed price, it indicates that the initial pricing might have been too low. This serves as a valuable lesson, suggesting the project should have been sold for a higher fixed price to cover actual expenses.
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Provides a real-time view of budget consumption.
6. Cost budget
An internal limit on how much cost may be incurred for the project.
Application:
- Set at project level to control spending
- Can also be set at line or group levels
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This figure is not automatically totaled in the header
7. Unit cost
The cost per individual unit of work or material, calculated based on:
Displayed at: Line level for detailed cost tracking.
8. Budget progress
Tracks the progress of budget usage compared to the set budget amounts.
Displayed as:
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The amount of budget spent versus the budget set.
Available at line and group levels for granular tracking.