Fixed-bid milestone billing is not a high science. But so many consultants aren’t using the basic tools for the job. If there’s one thing that’s ignored in the freelancer toolkit, it’s milestone invoicing. (look below for the video)
“We just whizzed up a Word document”
“Until we found this”
The overwhelming majority use a spreadsheet and word processor for client invoicing. And sure, that works to get started. Nobody can dispute that.
But if you’re past the point where simple office tools no longer work for you, watch the video and scroll down for some more info and new ideas.
Milestone billing is just the start
With an sweet system like ST, you can set up invoicing milestones to support fixed-price contracts. In other words, you agree upon a fixed bid for a job, but you also agree to break the bill into parts. Often there’s an invoice at the start, another in the middle, and one final invoice at the end. The project is considered fixed bid because the total amount cannot change, but you have agreed to send multiple invoices that total up to that amount.
You can set up milestones in the following form:
- Percentage of the total fixed bid contract
- Fixed dollar amount
- Date range for all time and materials
“Percentage of fixed amount worked for us”
Once you set up milestones for a project, you can use them for invoicing. Just choose the milestone when creating a new invoice, and the subtotal will update immediately.
There’s more to consulting than invoicing
Having a slick invoicing system is great, but there’s more to the consulting formula than invoicing. What about your projects? Tasks? Employee scheduling and availability? PTO accruals? You probably want a slick system for those things too.
“We came, looking for an invoicing system”
“And found project tracking and management was included”
Integrated project tracking
Back up from invoicing for a bit… What feeds it? When you think about it, you soon realize that employee time tracking is what feeds the invoicing engine. You have consultants working projects and tasks, each one tracking billable and non-billable hours. Those hours must flow freely to the invoicing system for the engine to run efficiently. That means you need integrated project tracking. You need tasks. And you need enough project management to keep things going forward. You’re now a few steps above the spreadsheet and word processor. You’re into some structured projects. And the time and expenses logged for those projects are the raw materials for invoicing.
“Track time and bill it”
“That’s our formula”
Time tracking and invoicing software
All you need now is a time tracking solution that matches your projects. You can use an Android or iOS time tracking app, or choose to enter time manually into the timesheet, or start and stop a timer. In any case, your project time flows right into the invoicing system. Just choose an invoice milestone and out pops a client invoice which you can save as PDF and send to your clients.
“Everybody already had Android’s, so we used those”
“We sync time with the cloud”
The article Fixed-Price Milestone Billing was originally published from http://www.stdtime.com
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