How to Use the Agency Fee Efficiency Calculator
When agency fees start feeling like a real cost, going in-house becomes tempting. This calculator computes your current net profit under the agency (revenue - ad spend - fee) alongside the projected in-house net profit (reduced revenue - ad spend - salary) so you can compare the two directly.
For example, with $35,000 monthly revenue, $10,000 ad spend, and a $1,500 agency fee, current net profit is $23,500. Going in-house with a $4,000 salary cost and an assumed 10% initial performance drop brings revenue down to $31,500 and net profit to $21,500 — actually $2,000 lower than staying with the agency.
Since this is a simulation based on the assumptions you enter, it's worth running it a few times with conservative and optimistic performance-drop estimates, and factoring in your local hiring market, before making the call.
Frequently Asked Questions
Agencies often optimize faster thanks to cross-account experience and platform expertise, so a newly hired in-house team may see a temporary dip in results during the first 3-6 months. This input conservatively reflects that transition risk.
When the gap is narrow, don't decide on the numbers alone — factor in qualitative issues like communication overhead, decision speed, and data ownership. But if the difference exceeds roughly 10% of ad spend, it's reasonable to weight your decision toward that direction.