Average day rate
The average day rate is the net price of one billed day: revenue invoiced divided by days billed. It is a price, never a cost. Margin lives in the gap to the daily cost of the firm.
Definition
The average day rate is revenue invoiced before tax divided by the number of days billed. It gives the net price of one day of work sold to a client. Firms use it to compare missions, clients, consultants and periods, to sanity-check a quote before signing, and to negotiate renewals from a known number.
The day rate is a price, never a cost. Its cost mirror is the average daily cost: what one day actually costs the firm, salaries and overhead included. The margin of a mission lives entirely in the spread between the two, so a rate that looks high means nothing until it is read next to that cost.
Formula
Average day rate = revenue invoiced before tax / days billed
Example: 12,500 EUR excl. VAT billed over 25 days = 500 EUR per day
Why it matters
The average day rate is the first profitability signal and the reference number a client anchors a negotiation on. Computed only company-wide, it hides pockets of silent discounting and lets a long low-rate mission pull the average down without any rate being cut. Tracked per client and per consultant, the same number shows where a renewal can be repriced and where a quote was signed too cheap.
How to manage your average day rate
- 1
Track the day rate per client and per consultant, not only company-wide: a single average hides pockets of discounting that never show up in the headline number.
- 2
Discount deliberately: know your cost floor, the daily cost below which a day destroys margin, before cutting the day rate to win a renewal.
- 3
Revisit rates at each renewal with the margin number on the table, so the conversation is about the spread between price and cost, not about the rate alone.
How Okouro shows it
In Okouro, each mission carries its billing rate and each consultant their daily cost, so the day rate and the margin spread compute continuously per mission and per person. Cost fields stay hidden from consultants by role. A free plan lets you start without a card.