What Do Your Clients Think When They Open Your Bill?
- September 3, 2013
- Posted by: Rochelle
- Category: Fees + Revenue
Have you ever had a business relationship where you dread opening their bill?
For me, it was the one with my credit card processor. I never knew what ridiculous add-on charge they would decide to ding me with that month. The last +40% surprise finally spurred me to action.
Now you can argue that credit card processing is a commodity and it’s nothing at all like your services. But in fact, I didn’t run to the lowest price, I went for the best combination of price, service and simplicity. Knowing what my bill would be—and feeling like I could trust their process—was more important than shaving off a few bucks here and there.
Which brings me to you. How easy—or hard—is it for your client to anticipate your charges? Does your billing build or destroy trust?
For more on this, read this post by Charles Green, America’s trust guru.
Be sure you catch his example of the ultimate contract by a solo consultant/coach:
“At the beginning of every month, you will send me a check for $5000. For the rest of that month, I will answer the phone all the time whenever you call. Should I ever not receive my check by the fifth day of the month, I will know that you’ve become unsatisfied with my services, and we shall both expect further conversations to cease.”
No nickeling, no diming. Just straight-forward pricing.
Not every business model lends itself to retainer work, but there isn’t a service business that can’t price simply if you trust your clients and your people.
Think about it. Isn’t the desire to add a gazillion qualifiers inversely proportional to the trust and faith we have in our clients and in ourselves?
Don’t make your client dread your invoice.
Trust over weasel words. Every. Single. Time.
6 Comments
Leave a Reply
This site uses Akismet to reduce spam. Learn how your comment data is processed.
If I don’t open the bill and think that was the best investment I’ve made lately, it’s time for me to find another consultant. And my consultants know I feel that way about them too. I value and honor their contribution to my job.
Nancy
And that’s what the best consultants WANT you to say Nancy! It’s most definitely a partnership…
Rochelle:
Thank you for posting a very insightful blog. This issue is one that challenges us continually.
As environmental consultants, we generally are providing professional assistance and expertise to clients who were caught unaware of their need for our services and who have not planned or budgeted for us in advance. Our involvement in their project too frequently is regarded as an annoying cost of doing business, or worse. Further, the direct consequence of our success is that the client no longer needs us. We’re always working our way out of business.
Because the work our profession provides generally is not planned for by the clientele and generally is viewed with disdain or worse, cost often is the chief if not sole selection criterion. Because of this commoditization, increasing the market for our professional services demands lump sum pricing. However, because the work itself is often indefinite in scope and duration, fixed fee contracts can be offered only pursuant to a set of assumptions and exclusions.
Not uncommonly as the work unfolds, those assumptions and exclusions wind up being violated. Sometimes the differences are inconsequential in nature and we chalk up the extra time investment to the cost of doing business. Often the violations can be profound, and our billing for time-and-expense, above the lump sum, gets “push-back” not uncommonly. We have limited but not eliminated the push-back by clear and frank up-front communication with clients about when work constitutes an “extra.” Still, too often clients come to expect our profession to “own” their business risk and to “eat” the extras.
Each circumstance is handled case-by-case and we think we’re doing OK because receivables have not been a problem. However, the issue of your insightful blog is one we wrestle with, month-in and month-out, and always have.
Thanks for such a thoughtful response Mark. Setting fees is an art form normally, but doubly so with the restrictions you describe. My bet is that your receivables haven’t been a problem because of the frank up-front discussions. Tough conversations, but great trust-builders…
Funny how I back into this after a morning CLE (Ethics) and much discussion over billing and client disputes about them — often involving a lack of communication between attorney and client over its growth. The retainer model I use continues to grow on me and I argue it should be the norm. It becomes clear to my clients and unlike others, I refrain from marking up other services I may use to advance their causes. I prefer my pricing to reflect my value and services.
Hi Corey,
I’m also a big fan of retainers, but seldom begin with them. I find doing a project first (usually very strategic/high value) allows us to work together with very focused results and then paves the way for the trust required (on both sides) to commit to a retainer…