Profitability Report - Parent / Child Agreements
Parent / Child Agreements
Depending on how your Connectwise is setup, you may use child agreements to breakdown the different service offerings under one bundled agreement. If this breakdown isn't handled correctly, your profitability numbers could be either greatly inflated or deflated which doesn't do you any good. Luckily, our tool has the ability to include / exclude any child agreement to make sure your numbers are truly accurate.
Labor vs. Non Labor
Before merging your child agreements, you need to take a look at how your agreements are broken up:- Which agreements are labor / non-labor agreements?
- Do you post time to the child agreements or do you post time only to the parent agreement?
- Do your child agreements have any Additions attached?
Once you get a pretty good idea on how your child agreements are working, you can now start to include / exclude them in your profitability report.
Setting up your agreements
To properly include / exclude your child agreements, please follow these simple steps:1) Login and Navigate to your Profitability Report:
2) Click on a particular client that has child agreements:
3) Click on the Child Agreements button to bring up the popup window
4) Click the checkbox next to any child agreement that you would like to use in your calculation
Note that we are adding a child agreement worth $550 per month
* if your child agreements are non-labor agreements, you do not need to include them. They will only deflate your utilization and inflate your gross margin numbers.
Before & After
Before you included the child agreement in your report, your utilization might look something like this:
But after you include the child agreement, you should now see a more accurate representation due to the added time and revenue from the child agreement:
Notice:
- Monthly Agreement Amount went from $377 to $927
- Utilization went from 48.08% to 19.55%