There are several benefits to having long-term regular clients.
For a start, it’s good for freelance cash flow (so you are not as susceptible to the freelancer feast and famine cycle) and also great for cultivating good freelancer-client relationships.
Furthermore, if you are in this fortunate position, there are also several options open to you as to how you can potentially charge them.
Here are some billing options to consider.
Retainer contract
A retainer is an agreement to pay you a set amount (usually per month) in return for a fixed set of deliverables. The advantage of this is that you know exactly how much you will be paid each month (or whenever it was you agreed), and the client can better manage their budget.
Retainers are generally sought after by freelancers as it means there is less uncertainty when it comes to freelancer cash flow. If more tasks are requested, the freelancer can simply bill more via an ad hoc invoice.
This type of arrangement is suitable where a set of deliverables are known and fixed in advance.
For these arrangements, where clients need to be billed on a fixed schedule, you can save time with Invoice Ninja by automatically billing long-term clients with recurring invoices. Auto-billing is a feature that enables the payment system to capture your client’s credit card details and store them for billing at a future date.
Fixed project rate
As with the retainer agreement, setting a fixed project rate provides a level of reassurance for both parties on the payment due date and amount.
However, there are some things to take into account for this type of arrangement, including whether you’ll require a partial or full deposit upfront and the billing frequency. For example, will you require full payment upfront, will you invoice monthly, or will you require payment at the end of the project?
Some issues can present themselves with this type of arrangement that should be ironed out from the get-go. These include the project’s scope and deliverables (to avoid any potential scope creep), so it’s wise to have a written agreement or contract in place.
Invoice Ninja’s partial payment feature is ideal if you require a partial deposit upfront. Once the client pays it, it converts a deposit invoice into a regular one. After your client pays the partial payment (deposit), the invoice will automatically update itself with the balance due and set a new final invoice due date.
Hourly or day rate
Longer-term relationships can also support hourly pricing or day rates, especially if the work is service-based or ongoing external support to the in-house team.
With both types of billing, you’ll need to accurately track your time and any expenses incurred, if applicable. This can be tricky if you are tracking hours manually, and you’ll also need to ensure you stick to the agreed budget.
Fortunately, Invoice Ninja’s tasks and project features allow you to create projects and tasks and track time spent on billable work. When you’re done with a task or series of tasks within a project, simply click and send your work time to an invoice with just 1-click!
Try Invoice Ninja for free here.
Progress or milestone invoicing
This is similar to the project rate, but you receive payment once you’ve hit certain milestones, and the client is billed incrementally throughout the duration of the project.
This can benefit both parties as the freelancer gets regular cash flow, and the client can manage the budget accordingly throughout. They can be especially beneficial for longer-term projects with large budgets.
Invoice Ninja’s Kanban boards can help you organize and plan your long-term client work.
A Kanban board is a project management tool that provides a visualization of single or multiple tasks and workflows. They are designed to make planning, managing, and completing tasks easier, thanks to a visual overview of the entire work process. You get to see what needs to be done, when it needs to be done, who needs to do it, and how much is left to do, all on one color-coded board.
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As with all the above billing options, a lot will also depend on the nature of your work, the client relationship, as well as accounting and regulatory compliance reporting and rules in your jurisdiction.
Another consideration is if the client is open (and able) to be billed in your preferred way. That’s one of the reasons why offering multiple online payment gateways is a good idea.
Some larger corporations will have their own payment policies in place that could include net 30-day or longer payment cycles. Also, keep in mind that some work might not lend itself to deposits or project rates.
All these factors need to be taken into account to ensure you agree on the optimum way to delight your clients and get paid on time – every time.
