Whenever a company offers tailored services to an individual client, a common question is whether the company should bill for these services. For example, if a software engineering firm meets with a client to discuss the specifications of the software application, it can be difficult to determine whether the client should be billed for the time spent consulting with him or her.
Make Sure To Bill To Cover Expenses
If it costs money, it costs money. You're in the business to make money and you will need to bill the client for any necessary expenses if you would like to make a profit. For example, if your company needs to spend time to learn your client's software system, the time spent learning it will need to be factored into the billable hours.
Billing For Questionable Tasks
When billing a client for individual hours, if there is ever a time when you aren't sure whether you should bill the client for a specific task, consider whether you would be able to justify that specific task to the client if he or she were to bring it up. For instance, if you were to attempt to bill a client for bathroom breaks, would you be able to justify including this as a part of the bill?
Billing For Special Favors
When clients ask for special favors, it is usually more acceptable to bill the client for extra reasons. For instance, if a client asks you to visit him or her at the last minute and doing so will require that you take an expensive flight to meet with him, billing the client for the flight would likely be acceptable.
Charging A Flat Fee
One way to avoid issues with charging hourly fees is to instead charge a single fee for the entire project. This eliminates a lot of the hassle of determining what you should charge your client for. However, if the project ends up taking longer than expected, you may be losing money as you are working hours that you essentially aren't paid for.
When you have determined what can be considered billable hours, the next step is to rely on an accounting firm to provide revenue recognition services. One of the key aspects of revenue recognition is when the rendering of services is recognized and when the client is then billed. It can be challenging to track your clients and the money you are owed, but a professional accounting service will make this much easier to achieve.