Glossary

Key terms and definitions used throughout Vantage and the professional services industry.

A

Agreement

A recurring contract with a company, typically a retainer. Defines monthly fees, included hours, and overage rates. See Retainers Guide.

Allocation

The assignment of a team member to a project with expected hours. Used for capacity planning.

AR (Accounts Receivable)

Money owed to you by companies. Tracked via outstanding invoices.

ARR (Annual Recurring Revenue)

Total recurring revenue on an annual basis. Calculated as MRR × 12.

B

Billable

Time or expenses that will be charged to the company. Opposite of non-billable.

Billing Type

How a project is billed. Options: Time & Materials, Fixed Fee, Retainer, Non-Billable.

Budget

The allocated amount (hours or dollars) for a project. Vantage tracks consumption against budget.

Burn Rate

The rate at which hours or budget are being consumed. Used to forecast project completion.

C

Capacity

The total available work hours for a person or team. Typically 40 hours/week per full-time employee.

Churn

When a company stops doing business with you. Churn rate is the percentage of companies lost over a period.

Cost Rate

The internal hourly cost of a team member. Typically calculated as (salary + benefits) ÷ annual hours.

D

DSO (Days Sales Outstanding)

Average number of days to collect payment after invoicing. Lower is better.

DSO = (Accounts Receivable ÷ Total Credit Sales) × Number of Days

Drawdown

The consumption of retainer hours. A drawdown report shows usage across all retainers.

E

Effective Rate

Actual revenue per hour worked. Calculated as revenue ÷ hours.

Effective Rate = Total Revenue ÷ Total Hours

Estimate

A projection of hours or cost for a project or task. Used for quoting and budgeting.

F

Fixed Fee

A billing type where the company pays a set amount regardless of hours worked.

G

Gross Margin

Revenue minus direct costs (labor), expressed as a percentage.

Gross Margin = (Revenue - Cost) ÷ Revenue × 100

H

Health Score

A composite metric (0-100) measuring company relationship strength. Based on financial, operational, relationship, and growth factors.

I

Invoice

A bill sent to a company for services rendered. Contains line items for time, expenses, and fees.

L

Lead Time

The time between project start and completion. Used for scheduling and capacity planning.

M

Milestone

A significant project checkpoint, often tied to deliverables or payments.

MRR (Monthly Recurring Revenue)

Predictable monthly revenue from retainers and subscriptions.

N

Net Revenue

Total revenue minus refunds and discounts. Also called net sales.

Non-Billable

Time or expenses not charged to companies. Examples: internal meetings, training, admin work.

O

Overage

Hours worked beyond a retainer’s included allocation. Typically billed at a higher rate.

P

Period

A billing cycle within a retainer agreement, typically one month.

Pipeline

Potential future work. Proposals sent, contracts pending, opportunities being discussed.

Profitability

The financial return on work performed. Can be measured per project, company, or team member.

PSA (Professional Services Automation)

Software that manages the operations of a professional services firm. Vantage is a PSA.

R

Rate Card

A schedule of billing rates. Can vary by service type, user role, or company.

Realization Rate

The percentage of billable time that actually gets invoiced.

Realization Rate = Invoiced Hours ÷ Billable Hours × 100

Retainer

A prepaid arrangement where companies pay for a block of hours or services monthly.

Revenue Recognition

When revenue is recorded in your books. In Vantage, controlled by invoice date.

Rollover

Unused retainer hours that carry forward to the next period.

S

SLA (Service Level Agreement)

Commitments for response and resolution times. Tracked per ticket priority.

Scope

The defined boundaries of a project—what’s included and excluded.

Scope Creep

When a project expands beyond its original scope without corresponding budget increase.

T

T&M (Time and Materials)

A billing type where companies pay for actual hours worked at an agreed rate.

Ticket

A unit of work—support request, task, or issue—tracked within a project.

Time Entry

A record of time worked. The fundamental unit of PSA systems.

U

Unbilled Time

Approved time entries that haven’t been invoiced yet.

Utilization

The percentage of available hours spent on billable work.

Utilization = Billable Hours ÷ Available Hours × 100

Benchmarks:

• 60-70% - Healthy for agencies
• 70-80% - High-performing teams
• 80%+ - Risk of burnout

W

WIP (Work in Progress)

Unbilled time and expenses that represent future revenue.

Workspace

Your Vantage account. Contains all your data—companies, projects, team, etc.

Formulas Quick Reference

See Also

• Core Concepts - How Vantage works
• Reporting - Where to find these metrics
• FAQ - Common questions