Marketing agencies bleed margin in three places
The first place is pass-through accounting. You spent $4,200 on Meta ads for the client, and at month-end you find the invoice was in your assistant's inbox under a personal Gmail account. By the time you rebill, you've either lost the receipt or marked it up incorrectly. Over a year, the slippage on agencies in the $1M to $5M revenue range is typically $10k to $40k of margin recovered once they get this clean.
The second place is contractor sprawl. Modern agencies are a network of specialists. Every new contractor brings their own invoice format, payment terms, and tax-record requirement. Manually tracking who has been paid, who is below the super threshold, and which ones are technically employees per the IR rules is a job in itself.
The third place is SaaS sprawl. An agency-wide audit on a typical 20-person shop reveals 30+ subscriptions, of which 8 to 12 are unused. The fix isn't another spreadsheet; it's having every subscription show up the moment it bills, so the question "do we still use this?" can be answered in real time.
How we approach it
TidyBooks doesn't try to be a project management tool, nor a CRM. It's the surface area underneath: every receipt, every contractor invoice, every platform statement, captured automatically, tagged to a client or project, ready to be rebilled or pushed into your accounting system. Inside agencies, that single piece of infrastructure pays for itself in the first month most of the time.