When you add a new staff member or create a new task in , you must set default billing rates for each.
The default billing rates consist of the staff base/billable rate and the task base/billable rate.
These rates will be used for all billing and reporting unless you set up historic billing rates or use custom billing rates to override the default.
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More about staff and task rates...
When adding a staff member, you need to specify the Base Rate and Billable Rate for that member of staff:
- [staff] Base Rate – this rate is used to calculate the 'actual cost' to you of that person's time, and so will affect all actual profit calculations. This rate is the full hourly cost to you of employing that staff member. To determine what rate to use, you need to start with their basic hourly rate (say $40 per hour) and add allowances for annual leave, sick leave, public holidays, bonuses, accident levies, superannuation and any other relevant costs. This may, for example increase the rate you need to put into the Base Rate field from $40/hour to (for example) $48.52. The more accurate this rate, the more accurate your profitability reporting.
- [staff] Billable Rate – answers the question 'If someone came to you and asked to buy one hour of Jo's time (regardless of what task/work Jo did), what would you charge them?'
When creating a task, you need to specify the Base Rate and Billable Rate for that task:
- [task] Base Rate – this rate is only ever used at the quote stage – and only if you do not specifically assign staff to tasks in the quote. So, if you don't know exactly who will work on the task if the quote is won, this rate is used as the best estimate of the actual cost to you of completing the task.
If only one person ever writes time sheets to the task, then the task base rate for that task will be the same as that person's staff base rate, as this is obviously the best estimate of what the actual cost will be to you. However, if several members of staff may be writing time sheets to the task (but exactly who is not known at the quote stage), then the best estimate of the eventual actual cost will be the weighted average of the staff base rates of those staff members most likely to perform the task.
- [task] Billable Rate – answers the question 'If someone came to you and asked to pay for one hour of a particular task (say 'Design') regardless of which member of staff did the work, what would you charge them?'
You can choose whether to use staff billing Staff billing is a client billing method based on billable rates associated with specific staff members. This method is useful if you have several staff working on a task but wish to charge them out at different rates, based on their experience, for example. Compare Task billing. or task billing Task billing is a client billing method based on billable rates associated with specific tasks. This method is useful if you usually have standard rates for a specific task, regardless of which staff members are working on it. Compare Staff billing. rates for billing your clients by setting Organisation Settings > Job section > Task Invoice Rate to Staff Billable Rate or Task Billable Rate.
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If you're using Staff Billable Rate...
...then at the QUOTE stage:
The estimated cost of a task on a quote will be either:
- Estimated Time x [task] Base Rate (no staff allocated to the task), or
- Estimated Time x [staff] Base Rate of allocated staff (if staff have been specifically allocated to the task).
The quoted amount for the task will be either:
- Estimated Time x [task] Billable Rate (no staff allocated to the task), or
- Estimated Time x [staff] Billable Rate of allocated staff (if staff have been specifically allocated to the task).
You can override the calculated quoted amount by changing the quote's Pricing Mode from Calculated Price to Fixed Price.
...and at the JOB stage:
- the actual cost of performing the job will always be the Actual Time x [staff] Base Rate of the staff member writing the time sheet
- the calculated billable amount will always be the Actual Time x [staff] Billable Rate.
The amount actually billed to your client will be determined by whether you are invoicing based on a quoted amount, or on actual billable time and actual billable costs.
You can override the calculated billed amount by changing the job's Pricing Mode from Calculated Price to Fixed Price.
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If you're using Task Billable Rate...
...then at the QUOTE stage:
- the estimated cost of a task on a quote will always be the Estimated Time x [task] Base Rate (as staff cannot be specifically allocated to tasks at the quote stage if you have selected Task Billable Rate)
- the quoted amount for a task will always be the Estimated Time x [task] Billable Rate
You can override the calculated quoted amount by changing the quote's Pricing Mode from Calculated Price to Fixed Price.
...and at the JOB stage:
- the actual cost of performing the job will always be the Actual Time x [staff] Base Rate of the staff member writing the time sheet to the task
- the calculated billable amount will always be the Actual Time x [task] Billable Rate.
The amount actually billed to your client will be determined by whether you are invoicing based on a quoted amount, or on actual billable time and actual billable costs.
You can override the calculated billed amount by changing the job's Pricing Mode from Calculated Price to Fixed Price.
If you change the system-wide Task Invoice Rate setting, existing jobs will continue to use the setting that was in effect when they were created; new jobs will use the new setting.
If you want to override the system-wide Task Invoice Rate setting to apply job-specific task billing or staff billing rates, click the Financial Settings button within the job, and make the necessary settings.