Project Profitability

Overview

Below is a business‑focused explanation of the Project Profitability report in Dafater, written for managers, project owners, and finance teams.

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Project Profitability Report – Business Overview

What Business Information This Report Provides

The Project Profitability report shows how profitable each project is by comparing income earned from the project against the cost of employee time spent on it.
It converts employee effort (captured through timesheets) into monetary cost and matches it against project revenue, giving a clear picture of which projects generate profit and which cause losses.

In simple terms, it answers: - Are we making money on this project? - Are labor costs under control? - Which projects are worth continuing or expanding?

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When and Why to Use This Report

Use this report when you want to: - Review project financial performance - Evaluate employee utilization vs revenue - Identify loss-making or low-margin projects - Support pricing, staffing, and contract renewal decisions - Monitor ongoing projects before issues become critical

It is especially useful: - During monthly or quarterly business reviews - Before approving additional resources for a project - While negotiating project pricing or renewals - When deciding which projects to prioritize or discontinue

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Key Columns and What They Mean for Business

Typical columns in the Project Profitability report include:

• Project
  Identifies the specific project being analyzed.

• Customer
  Shows which customer the project is for, helping assess customer-wise profitability.

• Total Revenue
  The income generated from the project.
  Business meaning: How much the project earned.

• Total Cost
  The cost of employee time spent on the project, calculated from timesheets and employee rates.
  Business meaning: What the project actually cost to deliver.

• Gross Profit
  Revenue minus cost.
  Business meaning: The actual money earned from the project.

• Profit Percentage (%)
  Gross profit expressed as a percentage of revenue.
  Business meaning: How efficient and healthy the project is financially.

• Total Hours
  Total employee hours spent on the project.
  Business meaning: Effort consumed to deliver the project.

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Available Filters and Their Business Purpose

Common filters include:

• Project
  Focus on a specific project to review its performance in detail.

• Customer
  Analyze profitability by customer to identify high-value or high-risk clients.

• From Date / To Date
  Review project profitability for a specific time period, such as a month or quarter.

• Company
  Useful when managing multiple business units to compare performance.

• Employee (if available)
  Understand how individual or team effort impacts project cost.

These filters help management narrow down analysis and make targeted decisions instead of relying on overall averages.

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How to Interpret the Results for Business Decisions

• High Profit & High Margin
  Indicates a healthy project. Consider scaling, using it as a pricing benchmark, or assigning similar resources to future projects.

• Low Profit but High Revenue
  Suggests cost overruns or inefficiencies. Review staffing, timelines, or billing rates.

• Negative Profit (Loss)
  Signals urgent attention. Investigate scope creep, underpricing, or excessive effort.

• High Hours with Low Revenue
  Indicates poor utilization or misaligned pricing. Adjust workload or renegotiate terms.

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Common Use Cases and Scenarios

• Project Review Meetings
  Managers use this report to explain why a project is succeeding or failing financially.

• Pricing Strategy
  Helps determine whether current billing rates cover actual delivery costs.

• Resource Planning
  Identifies projects that consume too much employee time with limited returns.

• Customer Profitability Analysis
  Supports decisions on which customers to retain, renegotiate with, or avoid.

• Performance Monitoring
  Enables early detection of cost overruns before projects are completed.

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Summary

The Project Profitability report in Dafater is a critical decision‑making tool that links people effort to financial outcomes. By clearly showing revenue, cost, and profit at the project level, it empowers businesses to manage projects smarter, price services correctly, and improve overall profitability.

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Report Information

• Module: HR
• Related DocType: Timesheet
• Report Type: Script Report
• Standard: Yes