As an independent consultant, it’s often hard to know if you’re charging too much, or too little, for your services.
Your bill rate, or the amount you charge clients pre taxes and fees, is the foundation upon which you'll build your independent consulting business. You'll want to strike the right balance between charging too much for your services, which might mean you're beaten by a lower-priced competitor, and charging too little, where you are missing out on valuable revenue or potentially not covering your costs for areas like retirement, healthcare, or taxes.
We at MBO Partners offer our Associates a a number of tools to help manage their independent business, and one of the most popular questions is often "how much should I charge?" It's nearly impossible to offer a blanket answer, as your fee will vary based on a number of factors, including experience, how much time you devote to work, and other incidental costs. Instead, we built a Bill Rate Calculator that allows you to plug in your own numbers and get a resulting bill rate that will work for you and your business. You can revisit this tool regularly to update your bill rate as your services or life needs change. We suggest revisiting your fee structure on a regular basis.
But many of you have also asked how to think holistically about the way you charge for your services, and to understand better how each part of your fee structure should be achieved. So we built a brand new video, which illustrates step-by-step how to set a price for your services, account for costs and utilization, and also build in a profit.
Here, you'll learn the basics of the foundational method for setting a bill rate, called a cost-based bill rate, and learn how to manually calculate a price that works for you and your business.
Ready to take it to the next level? View our comprehensive bill rate guide, which covers how to use your cost-based rate to jump into two other bill rate types: market-based and value-based.
News and notes for independent workers and their clients. This is the February 20, 2017 edition of The Weekly Independent from MBO Partners.
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