vertical-professional-services

# Vertical: professional services — bill time, defend margin, sell the scope Agencies, consulting firms, and creative studios sell hours and deliverables, not units. Their economics are unintuitive: revenue can rise while margin collapses, and the document that wins the work (the proposal/SOW) is also where margin leaks. Incumbents (Scoro, Productive, Accelo, Ruddr, BigTime — collectively "PSA", professional-services automation) model this correctly; a naive build does not. Spec against the real domain. ## 1. Domain vocabulary - **SOW (statement of work)** — the binding scope: deliverables, timeline, price, terms. It IS the contract and the upsell surface. - **Engagement types**: **project** (fixed scope/price), **retainer** (recurring fee for a capacity/hours bucket), **T&M** (time & materials — bill actuals). - **Utilization rate** — billable hours ÷ available hours. The first lever of margin. - **Realization rate** — billed amount ÷ standard value of hours worked (i.e. how much of what you *could* bill you actually invoiced and collected). The second lever. - **Billable vs non-billable** — every time entry carries this flag; non-billable (admin, sales, rework) is pure cost. - **WIP (work in progress)** — unbilled-but-delivered work; revenue earned, not yet invoiced. Agencies carry it for weeks. - **Blended rate** — single effective $/hour across a mixed-seniority team on an engagement (vs per-person rate cards). - **Change order** — a formal amendment when s...