Nov 16, 2025·8 min
Create a Web App for Agencies to Track Hours and Profitability
Learn how to plan and build a web app that helps digital agencies track billable hours, budgets, utilization, and real project profitability with clear reports.
Learn how to plan and build a web app that helps digital agencies track billable hours, budgets, utilization, and real project profitability with clear reports.
Before you design screens or choose a database, get specific about what “success” looks like for the people who will live in the app every day. Agencies fail at time tracking less because they lack features and more because the goal is fuzzy.
Agency owners want confidence: “Are we actually making money on this retainer?” They need rollups across clients, teams, and months.
Project managers need control and speed: tracking burn vs. budget, spotting scope creep early, and getting timesheets approved on time.
Team members (and contractors) need simplicity: log time quickly, understand what to track against, and avoid being chased for missing entries.
Start with outcomes you can measure:
At minimum, profitability is:
Revenue (invoiced or recognized) minus labor cost (internal cost rates for employees + contractor fees) minus overhead allocation (optional at first, but important for true margins).
Even if you don’t model overhead on day one, decide whether you’re aiming for project margin (direct labor only) or true margin (includes overhead). Naming this up front prevents confusing reports later.
Spreadsheets and separate timers usually lead to inconsistent categories, missing approvals, and mismatched versions of “truth.” The result is predictable: under-billed hours, late invoicing, and profitability reports that no one trusts enough to act on.
Before you design UI, map how work actually moves through an agency—from “we need to track time” to “we billed and reviewed margins.” If your app fits existing habits, adoption is easier and data quality improves.
Most agencies use a mix of timer-based tracking (great for deep work and accurate start/stop) and manual entry (common after meetings, context switching, or mobile work). Support both, and let teams choose.
Also decide whether your workflow centers on daily logging (better accuracy, less end-of-week panic) or weekly timesheets (common in agencies with approvals). Many teams want daily reminders but a weekly submit step.
Time tracking only works if projects are set up the way agencies price:
During mapping, note who creates clients/projects (ops, PMs, account managers) and what they need: service lines, roles, locations, or rate cards.
Approvals typically happen on a predictable cadence (weekly or biweekly). Clarify:
Agencies commonly review margins by project, client, service line, and person. Mapping these reporting expectations early prevents rework later—because it dictates what metadata must be captured at time entry, not after the fact.
Your data model is the contract between your product, reports, and invoices. If you get it right early, you can change UI and workflows later without breaking profitability math.
Start with a small, well-linked set of objects:
Every report you care about ultimately depends on time entries. At minimum store:
Also capture foreign keys: person, project, task/activity—and include immutable created_at/updated_at timestamps for auditability.
Agencies rarely use a single hourly rate. Model rates so they can override each other:
A practical rule: store the rate applied on the time entry at approval time so invoices don’t change when rate cards are edited later.
Profitability requires costs, not just billables:
With these pieces, you can compute revenue, cost, and margin without forcing agencies into one rigid workflow.
If your time tracking app only works for hourly billing, people will bend the tool to fit reality—usually with spreadsheets and manual notes. Agencies commonly run mixed portfolios (hourly, fixed-fee, retainers), so your app should support all three without changing how teams log time.
Hourly work is straightforward on paper: billable time × rate. The tricky part is that rates vary.
Support rate cards by role (Designer, PM), by person, by client, or by project. Then add controlled adjustments:
This keeps billable hours tracking accurate while allowing account teams to match client expectations.
Fixed-fee projects succeed or fail on how quickly you burn the budget. Here, time tracking isn’t just for invoicing—it’s for project budgeting and early warning.
Model a fixed-fee project with:
Then show “burn vs. budget” over time: week-by-week burn, forecast to completion, and how project margins trend as scope changes. Make it obvious when a project is profitable today but drifting.
Retainers are recurring and rule-heavy. Your tool should let teams set a monthly allocation (e.g., 40 hours/month), then define what happens at month-end:
When time exceeds the allocation, support overages billed at a defined rate (often different from the standard rate card). Keep the math transparent so clients trust the totals.
Agencies need non-billable categories like internal work, presales, admin, and training. Don’t hide these—treat them as first-class time types. They power utilization rate and agency reporting, and they explain why “busy” doesn’t always mean “profitable.”
A time + profitability app succeeds when everyone trusts the numbers. That means choosing a small set of metrics, defining them once, and using the same formulas everywhere (timesheets, project views, and reports).
Start with three fields that every agency understands:
Formulas:
billable_hours × bill_raterevenue ÷ hours_logged (or billable_amount ÷ billable_hours for time & materials)EHR is a great “sanity check” metric: if two projects have the same rate card but wildly different EHR, something is off (scope creep, discounts, write-offs).
Profitability needs cost, not just revenue. Keep it simple and include only labor at first:
internal_labor_cost + contractor_cost(revenue − cost_of_labor) ÷ revenueDefine internal cost as an hourly cost rate (salary + taxes + benefits, divided into an hourly number) so the app can compute it automatically from timesheets.
Utilization is where teams get confused, so define “available hours” explicitly.
billable_hours ÷ available_hoursDocument this definition in-app so reports don’t turn into debates.
Track budgets in both hours and money:
actual_hours − budget_hoursactual_revenue_or_cost − budgeted_revenue_or_costTrigger simple alerts at thresholds (for example: 80% consumed, then 100% overrun) so project managers can act before margins disappear.
If logging time feels like paperwork, people will avoid it—or fill it in on Friday night with guesses. The goal is to make time entry faster than procrastination, while still producing reliable data for billing and profitability.
Prioritize speed over fancy visuals. A good default is “one line = one entry” with project, task/activity, duration, and an optional note.
Make the common actions nearly instant:
Some people love timers; others prefer manual entry. Support both.
For timers, keep it practical:
Weekly timesheets are where adoption is won.
Use a week view that supports:
Keep notes optional but easy to add when required for invoicing.
Mobile doesn’t need every feature. Focus on:
If approvals matter, make them doable in under a minute—otherwise they’ll bottleneck billing.
If agencies don’t trust who can see, edit, and approve time, they won’t trust the numbers. Roles and permissions are also where you prevent “accidental accounting” (like a contractor editing last month’s approved timesheet).
Most agencies can cover 95% of needs with five roles:
Avoid creating a “custom role builder” in v1. Instead, add a few toggles (e.g., “Can approve time,” “Can view financials”) for edge cases.
Approvals should enforce consistency without slowing people down:
Agencies often need confidentiality boundaries. Support project-level access (assigned vs. not) and a separate permission for financial visibility (rates, cost, margin). Many teams want PMs to see hours but not pay rates.
Provide email/password with strong reset flows as a baseline. Add SSO (Google/Microsoft) when you’re selling to larger teams. Enforce secure sessions (short-lived tokens, device logout, optional 2FA) so approvals and financial reports aren’t exposed if a laptop is lost.
Hours aren’t “billable” until they can flow into an invoice that a client understands. The best way to avoid double entry is to treat time as the single source of truth: people log work once, and everything downstream (billing, write-offs, exports, integrations) references those same entries.
Design your timesheet data so it can be exported exactly how finance teams build invoices. Provide invoice-ready exports that can be grouped and subtotaled by client → project → person → task (and optionally by date range).
A practical approach is to add a simple “billing status” to each entry (e.g., Draft, Ready, Invoiced) and a “billing reference” once it’s pushed to invoicing. That gives you traceability without copying data into multiple systems.
If your product already includes time tracking, show how billing ties back to it (e.g., from /features/time-tracking to an “Invoice prep” view) so users see the end-to-end flow.
Agencies frequently adjust time: scope changes, goodwill discounts, internal mistakes. Don’t hide this—model it.
Allow write-offs and adjustments at the line level (or as an invoice adjustment) and require a reason code such as Out of scope, Client request, Internal rework, or Discount. This helps explain margin changes later and makes client conversations easier.
Many agencies already use accounting or invoicing tools. Support integration options through:
For smaller teams, also provide clean CSV/XLSX exports; for growing teams, point them to plans and integration capabilities on /pricing.
A time tracking app for agencies lives or dies on trust: totals must add up, edits must be traceable, and reports must match invoices. Choose boring, proven components that make accuracy and maintainability easy.
If you want to get a working prototype in front of an agency quickly, a vibe-coding platform like Koder.ai can help you generate a React web app with a Go + PostgreSQL backend from a structured chat—useful for validating your workflow, data model, and reports before you invest heavily in custom UI polish.
Use a relational database (PostgreSQL is a common default) because billable hours tracking relies on clean relationships: people → projects → tasks → time entries → approvals → invoices.
Structure tables so you can answer, “What did we believe was true at the time?” For example:
Keep endpoints simple and predictable:
Add idempotency for create actions and clear validation errors—people will enter hours from multiple devices.
Prioritize four experiences: a fast timesheet, a manager approvals queue, a project dashboard (budget + burn), and reporting with filters that mirror agency reporting needs.
Use a job queue for reminder emails/Slack pings, scheduled exports, recalculating cached reports, and nightly data quality checks (missing rates, unapproved timesheets, budget overruns).
Agencies don’t fail to track profitability because they lack features—they fail because the app is too hard to adopt. Start with a small MVP that matches how teams already work, then add depth once data quality and habits are in place.
A blank system kills momentum. Ship with (or generate) seed data so a new workspace can click around and understand the model:
This reduces onboarding time and makes demos feel concrete.
Your MVP should deliver one closed-loop outcome: log time → approve timesheets → see margins.
Include:
Keep the margin report opinionated: one screen, a few filters, and a clear definition of “cost” and “revenue.” You can add nuance later.
If you’re building fast, consider using Koder.ai’s Planning Mode to outline entities, permissions, and approval rules first, then generate the initial app and iterate. You can also export the source code later if you decide to move to a fully custom pipeline.
Once teams are consistently submitting and approving time, add forward-looking tools:
After the core workflow is trusted, expand without bloating the UI:
The rule of thumb: every new feature should either improve data accuracy or reduce time spent maintaining the system.
Shipping a time and profitability app isn’t just about features. The biggest threats to trust are subtle: “my hours changed,” “the report is slow,” or “why are you storing that?” Address these risks early so agencies feel safe rolling it out to the whole team.
Time tracking rarely needs sensitive personal data. Keep user profiles minimal (name, email, role) and avoid collecting anything you can’t clearly justify.
Add retention controls from day one: let admins set how long to keep raw time entries, approvals, and invoices (often different rules). Make exports easy for audits, and provide a clear way to delete or anonymize departed contractors’ data while preserving financial totals.
Small “math quirks” create big disputes. Decide and document your rules:
Also think about merged sessions (stop/start timers), overlapping entries, and what happens when a user changes their device clock.
Agencies live in weekly and monthly views—utilization, project margin, client profitability. If every dashboard loads by re-deriving totals from raw entries, you’ll hit a wall.
Use pre-aggregations for common slices (by day/week, project, person) and update them incrementally when entries change. Keep expensive “what-if” recalculations separate from the main reporting path.
Any change that affects money should be traceable: time entry edits, rate card updates, budget changes, write-offs, and approvals. Capture the actor, timestamp, previous value, new value, and a reason note.
This isn’t just for compliance—it’s how you resolve disputes quickly and keep managers confident in the numbers.
A time-tracking app succeeds or fails in the first few weeks. Treat launch like a behavior change project: reduce friction, set expectations, and make progress visible to the people who do the work.
Start with a clear migration plan: what data must move (clients, projects, users, rate cards), what can start fresh (historical timesheets), and who signs off.
Prepare templates and smart defaults so teams don’t face empty forms:
Run a short pilot with one team for one billing cycle, then roll out agency-wide. Keep a simple “how to log time in 60 seconds” guide inside the app (e.g., on the /help page).
Use gentle automation to create habits:
Make approvals lightweight: a manager should be able to approve a week in minutes, with comments only when something is off.
Track a small set of operational signals:
In the first month, prioritize removing friction: fewer required fields, better defaults, faster entry. Next, automate the repetitive parts—suggested tasks, carry-over timers, anomaly flags—based on real usage patterns rather than assumptions.
Start by defining the outcomes you want to improve:
If you can’t measure “success,” teams will argue about features instead of fixing behavior.
Design for three groups with different motivations:
When these needs conflict, bias the daily UX toward the people who must log time, and keep management complexity in reports and permissions.
At minimum, store:
Decide early whether you’re reporting (direct labor only) or (includes overhead) so your reports don’t contradict each other later.
Because they create multiple “versions of truth”:
A single system with clear workflows (log → submit → approve → invoice/export) prevents under-billing and makes profitability reports trustworthy.
A practical v1 workflow is:
This gives you clean data for billing and reporting without forcing everyone into the same logging style.
Keep the core entities small and well-linked:
If reports are a priority, capture needed metadata at entry time (project, task/type, person) instead of trying to “fix it in reporting.”
Model rates with clear override rules, then “freeze” the applied rate on the approved entry:
Store the applied bill rate (and optionally cost rate) on the time entry at approval time so invoices don’t change when rate cards are updated later.
Support all three without changing how people log time:
The key is separating from .
Pick a small set and define them once:
Focus on an MVP that proves one loop: log time → approve → see margins.
Include:
Once teams trust the basics, add forecasting, automation, and integrations (and document guidance in places like /help and /pricing).
billable_hours × bill_raterevenue ÷ hours_logged (or billable_amount ÷ billable_hours)internal_labor_cost + contractor_cost(revenue − cost_of_labor) ÷ revenuebillable_hours ÷ available_hours (define “available” explicitly)Then use the same definitions in timesheets, project views, and reports to prevent debates.