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Consultant Billing Alternatives

I am a one man shop and I do accounting/finance projects of various complexity for small to mid size businesses. Is it unethical/problematic to change your hourly rate based on the client's ability to pay/the task at hand? If so, how can I adjust pricing for more complicated projects or larger clients who are used to paying a higher hourly rate?

Answers

EMERSON GALFO
Title: CFO
Company: C-Suite Services
LinkedIn Profile
(CFO, C-Suite Services) |

It is perfectly fine to adjust rates based on project complexity or just plain client size. The balance between the price of your time/skills, complexity of work, plus what the client/market can bear (or what they are used to paying) should determine your rate.

Jason M. Jones LPA
Title: Deputy Treasurer - Staff Accountant
Company: Franklin County Treasurer
(Deputy Treasurer - Staff Accountant, Franklin County Treasurer) |

Frankly, I would recommend that you ditch the hourly rate entirely and move to value based fixed fee billing, as it typically encompasses the very elements you want to incorporate into your billing model (client's ability to pay and scalability thereof, complexity of projects, perceived value of your work, etc.).

That said, there is nothing unethical nor problematic in tailoring your rate to suit your client. That is why many of us have a preference for services that are tier-based and packaged/bundled, it seeks to accomplish the same end result.

Daniel Katibian
Title: Senior Accountant
Company: Synagro
(Senior Accountant , Synagro) |

Mr. Jones-
Do you happen to have a template for the based fixed fee billing you mentioned?

Thanks!

Anonymous
(CEO & COO) |

Yes, as consultants we all prefer a monthly rate or retainer fee, so we are not tied to specific tasks as we are offering value above an beyond the completion of a task, but many clients, at least your new ones, will want an hourly rate. Normally, I need to start with an hourly rate and then as we build a relationship a monthly retainer arrangement is worked out that is mutually beneficial to both parties

Topic Expert
Wayne Spivak
Title: President & CFO
Company: SBAConsulting.com
LinkedIn Profile
(President & CFO, SBAConsulting.com) |

I tend not to like task-based or project-based fee structures. They develop mission creep, and unless you have the proper if-then-else approvals in your contract, you end of eating time; and time is money.

I like retainer or just plain hourly (maybe a cap per month with an over-ride).

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