Agency time tracking software records every hour your team spends against a client, project and task. It then turns those hours into approved timesheets, retainer burn, utilisation and invoices.
Most agencies already capture time somewhere. The trouble is that a spreadsheet or a payroll timesheet, including the payroll-shaped Sage timesheets inside accounting suites, tells you someone worked 40 hours. It does not tell you that six of them were unbilled revisions on a fixed-fee job, or that one retainer is running at 130%. This guide covers how time tracking for agencies works, how to read utilisation across a team, and what to check before you buy. For a single weekly total with breaks and overtime, the free time card calculator does the job without an account.
Quick Answer
What is agency time tracking software? It is time tracking built around client work rather than payroll. Every entry carries a client, project, task and billable flag. Managers approve the week, and approved hours flow into retainer reports, utilisation and invoices. The best time tracking and billing software for agencies keeps capture, approval and invoicing in one record.
Key Takeaway: Agency time is revenue data. Track it by client and billable status, approve it weekly, and invoice only from approved hours.
What does agency time tracking software actually do?
It does four jobs that a generic timesheet does not. Each one maps to a question an agency owner asks every month.
| Job | Question it answers | What to look for |
|---|---|---|
| Capture | Where did the hours go? | Timers, calendar or activity-based capture, client and project on every entry |
| Classify | Which hours can we bill? | Billable and non-billable flags, rates per person or role |
| Approve | Are these hours right? | Weekly sign-off by a project or account lead, locked periods |
| Bill and report | Did the client pay for the work? | Retainer burn, budget alerts, invoices built from approved time |
A generic HR timesheet stops after capture. Agency time tracking software carries the same entry through all four steps. That is why the record can be trusted when it reaches an invoice.
The hierarchy matters too. Time should sit under client, then project or job, then task. Without that structure, you cannot separate billable and non-billable hours or allocate cost to the right revenue line.
How is creative agency time tracking different from staffing agency timesheets?
The word “agency” covers two very different businesses. Creative, marketing, digital and ad agencies bill clients for project and retainer work. Staffing agencies place workers with clients and run payroll for them.
Creative agency time tracking is about margin on client work. Designers, writers and developers switch between accounts all day. Revision rounds, pitch work and account management eat hours that never reach an invoice. The tool has to show which of those hours are billable and which engagement is overrunning.
Ad agency time tracking adds job numbers and campaign codes. Advertising agency time tracking software usually needs time logged against a job or campaign, alongside pass-through costs such as production or media fees. Pitch and new-business time should be tracked too, even though it is not billable, because it is often the biggest hidden cost.
Staffing firms need a different workflow: worker shifts, client sign-off and a payroll handoff. If that is your model, the staffing agency timesheet software guide covers it in detail.
How do you track billable utilisation across an agency team?
Track it from approved timesheets, by person and role, every week. Billable utilisation is billable hours divided by available hours. Available hours are contracted hours minus holiday and leave.
Here is an example week for a five-person creative team. The figures are illustrative.
| Role | Available hours | Billable hours | Billable utilisation |
|---|---|---|---|
| Senior designer | 35 | 27 | 77% |
| Designer | 35 | 29 | 83% |
| Copywriter | 35 | 21 | 60% |
| Account manager | 35 | 14 | 40% |
| Creative director | 35 | 12 | 34% |
| Team | 175 | 103 | 59% |
The team figure looks weak, but the detail tells a different story. The account manager and creative director are not meant to bill 80% of their week. The copywriter at 60% is the real question. A quick look at their entries might show eight hours of unscoped revisions on a fixed-fee job.
That is why targets should be set by role, not firm-wide. Run the same review every Monday on last week’s approved time. The billable utilisation rate guide explains the formula and role targets, and the employee utilisation rate guide covers the wider people view.
How do agencies track retainers and stop scope creep?
Track hours against the retainer allowance, not just as a running total. Scope creep is rarely one big request. It is a run of small favours that never become a change order.
Take a monthly retainer of 60 hours at £95 an hour, worth £5,700. By day 15, the team has logged 48 hours. Half the month has gone, but 80% of the hours are used. At that pace the account ends the month near 96 hours. That is 36 hours, or £3,420 of work, that nobody has agreed to pay for.
Good agency time tracking software flags that at day 15, not at month end. The account lead can then trim the work, agree extra hours or raise a change order. On a fixed-price project, the same check compares logged hours with the hours in the quote. To see what that overrun does to margin, work through the project profitability calculation.
How do approved hours turn into client invoices?
Approved hours should become the invoice lines, with no retyping. The entry already carries the client, project, rate and billable flag. Rebuilding that by hand in another system is where accuracy slips.
A weekly approval step is what makes this work. A project lead reviews the week, queries gaps and locks the period. Late or missing timesheets break the chain, so the guide on getting employees to submit timesheets on time is worth reading before you change tools.
If you invoice from accounting software, connect it directly. Our guide to connecting time tracking to Xero invoicing shows one setup. When each invoice line traces back to an approved, timestamped entry, client disputes over billable hours get shorter and rarer.
How should agencies track AI and multi-client work?
Track AI agent work and human work against the same client and project. More agencies now deliver part of the work with AI agents, which adds token and tool costs to each engagement. If those costs sit outside the timesheet, the margin on that client is overstated.
The fix is to log agent runs alongside human hours. You can then track AI agent costs in real time and see the true cost of each account. That record is also the basis for billing clients for AI work and for setting AI automation agency pricing that covers usage.
Multi-client switching is the other leak. A developer may touch three clients before lunch and estimate it all at 6pm. Capture that infers the client from real activity closes most of that gap. We cover the pattern in time tracking for dev agencies with multiple clients.
What should you look for in time tracking software for agencies?
Judge tools by the questions your operations lead must answer each week. A short checklist:
- Low-friction capture. If logging depends on memory, the data will have gaps. Prefer capture from real activity, with timers as a backup.
- Client, project and task structure. It should match how you quote and bill.
- Billable flags and rates. Rates per person or role, plus non-billable categories such as pitches and internal work.
- Weekly approvals. Sign-off by project or account leads, with locked periods.
- Retainer and budget alerts. Burn against allowance while there is still time to act.
- An invoicing path. Approved hours into invoices, ideally through your accounting software.
If cross-project allocation is the main problem, define the workflow first with the billable hours across multiple projects guide. Then compare it against Keito’s pricing and plans, rather than paying for fields your agency will not use.
Frequently Asked Questions
What is agency time tracking software?
Agency time tracking software records time against clients, projects and tasks, and marks each entry as billable or non-billable. Managers approve the hours each week. Approved time then feeds retainer reports, utilisation and client invoices.
How is time tracking for agencies different from a normal timesheet?
A normal timesheet is built for payroll and only shows how many hours someone worked. Time tracking for agencies shows which client each hour belongs to and whether it can be billed. That makes it possible to protect margin, not just pay staff.
How do you track billable utilisation across an agency team?
Divide each person’s approved billable hours by their available hours, then review the result weekly by role. Available hours are contracted hours minus holiday and leave. Set targets per role, because account and leadership roles bill far less than designers or developers.
What is the best time tracking and billing software for agencies?
The best option is the one that keeps capture, approval and invoicing in one record. Look for client and project structure, billable flags and rates, weekly approvals, retainer alerts and a direct path into your accounting software. Test it on one real retainer before rolling it out.
Does creative agency time tracking need to cover non-billable work?
Yes. Pitches, internal reviews and unscoped revisions are where creative agencies lose the most time. Tracking them as non-billable shows the true cost of each client and each new-business win.
Can agency time tracking software stop retainer overruns?
It can flag them early. By tracking hours against each retainer’s allowance, it shows when an account is burning faster than the month is passing. The account lead can then trim work or agree extra hours before the overrun is written off.