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Consultancy rate calculator: set rates for your whole team
A consultancy rate starts with the fully loaded cost of a role, divided by the hours that role is expected to bill. A margin is then added, so profit is a share of the rate you charge.
Set rates for several roles with one set of overheads, then price a project with a blended team rate. Freelancers can use a single row.
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When a spreadsheet stops working
The rate assumes a utilisation the spreadsheet cannot see coming. Kavaro is resource management software for agencies and consultancies. The utilisation report shows each person's billable and non-billable time from the bookings already on the schedule, by week, person, domain and project. You can see whether the rate will hold before you quote. It is a per-person view, not a separate report grouped by role.
Check the utilisation behind your rates: try Kavaro freeYour results
Senior consultant: £110.76 an hour (£831 a day). Blended team rate £73.86/h
Available hours: 1,702.5. Target margin is 25% of the rate you charge.
| Role | Fully loaded cost | Billable hours | Break-even / h | Target / h | Target / day | Revenue / year |
|---|---|---|---|---|---|---|
| Senior consultant | £99,000.00 | 1,191.75 | £83.07 | £110.76 | £830.71 | £132,000.00 |
| Consultant | £69,000.00 | 1,276.875 | £54.04 | £72.05 | £540.38 | £92,000.00 |
| Analyst | £53,400.00 | 1,362 | £39.21 | £52.28 | £392.07 | £71,200.00 |
If Senior consultant bills 60% instead of 70%, your 25% margin drops to 12.5%.
If Consultant bills 65% instead of 75%, your 25% margin drops to 13.5%.
If Analyst bills 70% instead of 80%, your 25% margin drops to 14.3%.
Project fee £14,772.11 · blended team rate £73.86/h · project margin 25.0%.
How consultancies set their rates
Available hours = (working days − holiday − public holidays) × hours per day. Fully loaded cost = salary × (1 + on-cost %) + overhead per person. Billable hours = available hours × target utilisation. Break-even rate = cost ÷ billable hours. Target hourly rate = break-even ÷ (1 − margin). That last step is margin, meaning profit as a share of the rate, not a markup added on top of cost. The day rate is the target hourly rate × hours per day. A year's revenue at that rate equals cost ÷ (1 − margin).
Worked example, using the example assumptions above: 260 − 25 − 8 = 227 days × 7.5 hours = 1,702.5 available hours. The senior consultant costs £70,000 × 1.2 + £15,000 = £99,000. At 70% utilisation that is 1,191.75 billable hours, a break-even of £83.07 and a target of £110.76 an hour, £830.71 a day in the table and £831 rounded in the headline. Revenue for the year is £132,000.00, which is £99,000 ÷ 0.75.
Why utilisation decides your rate
The target rate only holds if the utilisation behind it is real. Utilisation and utilization are the same word. The table keeps the senior consultant's cost and 25% margin, and changes only the utilisation you plan for. The last column is the margin you actually make if you keep charging the 70% rate, £110.76 an hour.
| Utilisation | Billable hours | Target rate if you plan for this | Margin if you still charge £110.76 |
|---|---|---|---|
| 60% | 1,021.5 | £129.22 | 12.5% |
| 70% | 1,191.75 | £110.76 | 25.0% |
| 80% | 1,362 | £96.92 | 34.4% |
If the senior consultant bills 60% instead of 70%, the 25% margin drops to 12.5%. See how a person is actually booked with the billable utilisation calculator.
Margin vs markup
A 25% margin is a 33.3% markup. Margin divides cost by (1 − 0.25). Markup multiplies cost by 1.25. On the senior consultant, a 25% markup on £99,000 would be about £103.84 an hour, not the £110.76 target. The common mistake is to add the margin on top of cost and then wonder why the year's profit is short of 25% of fees.
Blended team rate: pricing a project with a mixed team
The project fee is each role's target hourly rate times that role's hours on the project, using the unrounded rates. The blended team rate is that fee ÷ the total project hours. In the example, 40 + 100 + 60 hours costs the client £14,772.11, which is £73.86 an hour, and the project margin is 25.0% because every role uses the same margin. Quote a blended team rate when the client is buying that mix. Quote the role rates when the mix may change, because a cheaper mix quietly drops the fee and a senior-heavy mix does the opposite.
From rates to a rate card
A rate card is the list of role rates you actually quote: the target day rate or the hourly rate for each role, and a blended team rate when you sell a mixed team. Kavaro keeps rate cards on the client or the engagement. Each booking takes its charge rate from that card, and each person's cost rate is saved on the booking. The finance view then shows revenue, cost and margin for the period.
To turn the rates from this calculator into a card you can send to clients, use the free agency rate card template. It has a client-ready version and a blended rate tab for pricing a team mix.
Questions people ask
How do consultancies calculate day rates?
Fully loaded cost for the role, divided by the hours you expect to bill, then divided by one minus the target margin. The day rate is that hourly rate times the hours in a working day. Margin is profit as a share of the rate, not a markup on cost.
What utilisation should a consultancy target?
SPI Research's 2026 professional services benchmark, reported by Deltek, puts the target billable utilisation at 75% and the 2025 actual at 66.4%. Alto Accounting, citing BenchPress and Synergist, puts delivery staff at 70–80% and directors at 30–40%. These are billable hours divided by available hours.
Should I charge hourly or a day rate?
A day rate on this page is the target hourly rate times the hours in your working day. Use whichever unit the client expects. The maths is the same, and the contract should say which one you are quoting.
What's a blended team rate in consulting?
A blended team rate is the total fee for a mix of roles divided by the total hours on that project. It is not a single person's rate. Quote it when the client buys the team. Quote role rates when the mix may change.