Category Archives: Products

Do I Really Need to Track My Hours? Why Your Answer Needs to be YES Every Time

Tags: Products | Date Posted: | Author:

You’re a business owner who spends a great deal of your own time working with clients. You move from one project to the next. You are constantly thinking about and moving forward on projects, but you don’t always track the specific number of hours you work on any given project. Why is this important? If you are getting the project done on time and your client is happy, why should you add the step of tracking your hours? What you may not realize is that you could be giving yourself away by not doing so.

What Does Your Contract Say?

Many architectural or engineering contracts will include a specific number of estimated hours for the project. If this is present in the contract you signed and you cannot document the hours worked to the client, concerns can come up. Your project could be put on the line as a result. You may not have encountered this yet, but it could be a clear reason why a project fails later.

How Much Are You Earning Per Hour?

Many architects and engineers offer by-the-hour rates to clients. This can be a very good thing. You know your hourly rate. Yet, when you are working on a project that is not paid by the hour, how much are you actually making on it?

It’s quite common for individuals to see a project as a total investment and payday. Yet, that project may not be as lucrative (or even worthwhile) if you are spending too many hours on it. For example, your project may pay a specific fee at completion of various milestones. If the project is difficult, you could be investing so many hours that any hourly rate is virtually nothing. Is the project really worth your time?

Prove Your Worth

Even those with fantastic clients often find themselves dealing with delays and budget overages. The client wants to know why. If you have done the work of tracking your hours, you have a very clear description of the reasons. If a project is going to overrun the budget and you need to get more compensation for your investment of more labor, you need to clearly show the client why this is the case. If you can pull up a record of the hours invested, you can easily demonstrate this need.

If you have not done so yet, now is the time to invest in time management and tracking software that makes the entire process of tracking your project hours easy to do. It does not have to lead to more time invested in paperwork. It can be done digitally from any location too. The key is to find a software program that achieves your goals and simplifies time tracking.

What to Do When You Have Unpaid Invoices

As you know, getting clients to pay their invoices can sometimes be difficult. After all, you worked your tail off to get the job drawn up, sent out to bid, built and closed out. You dealt with all the problems that went along with completing the project. Through it all, you knew that your payday was on its way, which is what kept you going at times. Then, you find out, your clients aren’t paying their invoices. You might wonder what you can do about it. Well, you might be surprised to know that there is a lot you can do.

Make Sure You Have a Good System in Place

The first step in ensuring prompt payment on a regular basis is to have a good system set up for billing. You can do this with software designed for just such a purpose. This will help you track time committed to a particular job and keep up with all the change orders and other additional expenses that alter your billing amount. Good software will also link to your business books, ensuring all your business finances are well organized.

Be Up Front with Expectations

Although the end of a job it’s a little too late to be putting this tip into action, at least you can do this from now on. With new clients or at the beginning of a new job with a current client, you need to explain how you invoice. For example, tell them you send out invoices every 30 days. Let them know how long they have to pay what they owe. Be up front. Then, if clients don’t want to pay in a timely manner, you can remind them about your preset expectations and how they agreed to comply. Make sure you get their signature on a contract that shows the payment terms upon which you both agreed.

Consider Implementing Interest on Late Payments

Believe it or not, the government actually has legislation in place that protects small businesses against late payers. Wow, it turns out they are good for something after all. Who knew? According to this legislation, you can add interest to a debt up to a certain amount and even procure some of your debt recovery costs.

Address the Problem in Person

Sending past due notices, emailing a client and leaving messages are all typical ways to encourage payment. However, they aren’t always effective. After all, it’s a little too easy to simply disregard an email or message. The way to ensure you have an effect and actually get something accomplished is to show up in person. Sure, it takes time out of your busy day, but look at it as a marketing endeavor. By showing up and maybe going to lunch with a client, you can reestablish the working relationship, find out about any upcoming jobs and drop a hint about your missing payment. You might even get a check that day if you let them know you are coming.

This should help you collect on unpaid invoices