Most of the articles I’ve come across on billable v. billed hours — regardless how the work was quoted — relate to time spent during a project. Some provide useful suggestions to track your time effectively and ensure the hourly rate you charge is actually the hourly rate you earn.
Investing time to network, promote your business, and explore mutual interests with a prospect is not only normal but essential. Yet what is the best way for a small business put a limit on the hours given away (free) to land new clients and interesting projects?
When do you go on the clock? And how do you broach that with your clients?
My business has three main components:
copywriting and adaptations
intercultural management and communications consulting and training
and strategic marcomm advisory and coaching to French businesses wanting to conquer the US market.
Each has its business development rhythm to transform a prospect into a signed client.
Copywriting and adaptation clock
This is straight forward (even if with some clients the touch points can stretch over a few months, the overall investment remains manageable). The prospect’s need is specific and the deliverable identified. The details just need to be fleshed out, the contract signed, and the project kicked off.
Intercultural consulting and training clock
The prospect’s need is fairly specific (a workshop, some coaching sessions). Translating that into a coherent program with clear goals, defined participants, and an action plan often requires (protracted) exchanges. I can spend hours on the phone, on email, or even in person discussing plans for an intercultural workshop, helping them structure it, figuring out who should participate and why, submitting draft programs and cost estimates and so on.
The time is unbillable. Or let’s say I haven’t figured out how to make it billable yet. I feel it’s part of the cost of doing business; sometimes it can represent several days of work – or at least reserved attention. When the workshop is delayed a quarter or two – or the objectives change – one has to start much of the process over.
[I wish independent professionals could run their businesses more like lawyers. The Bar and Grill Singers acapella group's song "Billing Time" says sings it all!]
Conquering the US market
The toughest situations, though, come up when preparing to provide strategic advisory services to (young) French companies aiming to head across the Atlantic.
They are typically at or near ground zero, save for perfecting their product or service. The thrilling challenge of working with these clients is that I can really leverage my experience and my creativity.
I’m passionate about international business development. Getting a joint-venture or new business off the ground and humming makes me leap out of bed in the morning (that I still treasure my grad school Garfield coffee mug that warns “I am not a morning person”, despite being an early riser, just underscores the point). Managing what exists doesn’t make me thrive; working with a team to launch something new does.
There are two main challenges for the prospect and consultant:
- What is the available budget to accomplish what is legally required to kick off v. what is needed to generate revenue down the pike? In other words, can they afford your services? Can they afford to go without?
- What is their marcomm and business development strategy (or do they need still to define it)? What are its tactical components? “We have some ideas, but where do we start?” is a question I often hear.
Exploring these two main threads takes time. So does developing mutual trust. Neither party can afford to make a mistake casting error. It is wise to invest in this mutual discovery process.
If you submit recommendations or a proposal too early, you may not have enough information to hit the mark or the prospect may not yet be ready to “buy”.
If you invest still more of your time and expertise to help them brainstorm and define needs/objectives, you are in a better position to lay out a strategy and implementation plan and budget that the prospect could sign off on. Yet in the process, you are acting as a strategic advisor, giving away your time and expertise for an uncertain outcome.
I have two such prospects in the pipeline right now, with a third coming up around the bend.
I’ve travelled to meet with them, exchanged many emails, researched their industry, and thought a great deal about the value I could bring them and the transatlantic rockin’ team I could put together.
The relationships are progressing.
It’s time to “formalize” (as we love to say in France) something as a sign of mutual goodwill and professional recognition. And this is the part I hate having to deal with, no matter how many years of experience I have.
[Intercultural note: Blame my French upbringing for this discomfort. It's easier to bite the bullet with American clients, most expect it: it's business, not personal.]
When do YOU decide your time becomes billable? How have you opened the conversation with your prospect? How have they responded? What would you do differently the next time around?
I look forward to hearing your thoughts.