Placing a value on their time is a challenge for all business owners, and smaller companies and sole traders in particular.
On what basis should you charge – an hourly rate? A fixed fee?
Richard Mathews, managing director of Swindon-based Regulatory Accounting – a subsidiary of the RFS Group, a leading FT100 regulatory and compliance consultancy – delivered a presentation to Business Village on Valuing Time for the Business Owner.
As a starting point, Richard said, you have to define what you mean by time, by dividing it into:
- working hours
- chargeable hours
- non-chargeable hours [ for the likes of admin / marketing / prospecting]
You work out what suits you best
- hourly rate
- day rate
- project based
- fixed fee
Then you have to factor in
- added value
- value to client
- re-sell value
And then you have to do a little maths, and work out how many hours you are going to work in a year (don’t forget to factor in your holidays, potential sick days, and the eight Bank Holidays).
Richard said that with all that in mind, plus an idea of what you need your business to earn, you should be able to assess what you need to charge.
If you missed the presentation, or would like a refresher, here it is in full:
If you missed this event, don’t forget that we meet every Thursday morning for breakfast at the Campanile Hotel, from 7.30-9am.
Our presentations are generally on the first and fourth Thursdays of the month – the next is ‘Learn to sell like the best: five key lessons from top performing sales people’ on April 27th.