I have an increasing number of clients for my business consultancy (focused on nonprofit fundraising). As much as I was hoping to develop some economies of scale by securing several clients with the same needs, they all seem to be very different ... and require varying degrees of hours, energy, investment, etc I am struggling with how to best structure my billing in a way that is most appealing to prospects and also the most profitable (and easiest to manage) for me. I have a somewhat visceral reaction to the idea of tracking hours and billing based on time ... my natural inclination is to bill by the project. But this has bitten me in the backside a few times due to scope creep (and my natural tendency to take on too much, as if I were an interim staff member). I recently met a consultant who bills by the week; she focuses full-time on one client's project for a week at a time and bills them accordingly. This sounded appealing, but is untenable for me since I have multiple conflicts (i.e. I teach at a local high school three days per week and also have some standing meetings for other clients, so I can't dedicate a full-time schedule to any client). But I've been wondering if I could bill by the week and just tell the client it's a batch of about 4-5 hours per day? What have you seen to be a good model?Bidding based on projects (my current approach)? Daily or weekly rates? Or should I just grow up and bill by the hour -- and if so, how do you keep the client from feeling afraid of the running clock (or feeling nickel-and-dimed for every time they email or call you)?
It is a tough solution. Personally, I don't like fixed price billing as you never know what you are going to get into - UNLESS - you have a packaged service of solutions that you plan to offer, clearly defined or the client. But then a fine line can occur as to variations and interpretations of what those specific deliverables are.
I believe in hourly billing against a retainer. It is the fairest for all as long as you are providing value for the time billed and measurable results. The client knows at least what his/her initial cost is and can have some control over it once the retainer is exhausted.
In this manner, as changes and curve balls come at you (and they will), you are protected and the client know he will have to pay.
Just my own personal opinion for what it's worth.