Billing (Client projects only)
We have baseline fee structures for one-time projects and ongoing work, but we deviate when it makes sense for the client.
The most common scenarios for One-Time projects are:
- Fixed cost, in phases. We create an estimate for the whole project and establish a fixed cost for the first phase but provide estimates for each subsequent phase. Then, prior to starting each subsequent phase, we agree on a fixed cost for just that phase.
- Hourly billing. We agree on a detailed overall scope but don’t commit to a specific cost. We provide an estimate and charge hourly. We quote the client a range of possible costs. For example, if our estimate is $100k, we might make the bottom of the range $80k and the top $120k. This gives the client confidence that the budget will be within a certain amount, while providing the flexibility of an hourly arrangement. In some cases we may put a “Cap” on a project so that the client knows they will end up under a certain budget, but in exchange we need flexibility in case the deliverables turn out to need more time than both parties are expecting. We try not to offer a cap on charges when deliverables are at all vague, as vagueness leads to scope creep.
Both fixed cost and hourly arrangements have upsides and downsides. We tend to prefer fixed cost when the scope of each phase of work can be reasonably grasped at the outset. Hourly arrangements offer the client the opportunity to control the final cost by making certain decisions during the process. When working hourly, it is important to contextualize the cost impact of any given choice the client is making. They should feel in control of where the final costs end up.
For ongoing projects, we default to our
All projects should have some kind of budget. For client projects, establishing a budget will usually be a part of the
As the team works, the PM should monitor the project budget constantly. Whenever they are trying to ascertain the status of a project, they should check the budget as well. When they do their weekly check-in with the client, if the project is hourly, they should update them on the status of the budget. If the project is fixed-rate, the PM doesn’t need to keep them in the loop since it doesn’t make a difference for them, but they should update the Strategist and team internally every week so they understand where we are at.
Managing Budgets in Harvest
For client projects, the Harvest project must reflect accurately the billing arrangement we have with the client. In cases where we are working from an estimate, the PM should enter the estimate into Harvest as the budget. If we have a fee floor or cap, the PM should ensure that is noted in the Harvest project notes.
Managing Non-USD Currency in Harvest
Harvest projects do not yet support multiple currencies, which sucks! We primarily work in USD. If we do a project in Euro or CAD, the least confusing way is to enter the correct absolute amounts into Harvest, then make sure that the final invoices reflect the correct currency. Harvest can invoice in any currency.
This means that when you see the budget report and statistics in Harvest, it will show simply with a dollar sign, but when the invoice goes out, it will be in the proper currency.
For example, if we are charging 200 euro/hr for a certain project, just enter $200 as the project rate. Don’t convert the rate to actual USD.