Your Time Is Too Valuable, Stop Charging For It

May 9, 2012
Sedona, Arizona
Cloudy 52 degrees

When you’ve got your head down doing a lot of client work, it’s easy to lose track of what’s going on with your business.

Just because you’re busy doesn’t mean you’re getting anywhere.

I started out years ago as a technology consultant charging $40 per hour.

When you do that, your days basically become $320 boxes. Each day, you only have 8 hours. And if you are able to bill all of those hours (you aren’t), then you max out at an income of $320 per day.

You won’t starve, but if you’re like me, you probably won’t be satisfied. Mainly because you’ll be very aware of the ceiling YOU have built above your head.

Soon after I started technology consulting, I raised my rates to $85 per hour. This was better, kind of. On paper, the rate was increasing, but there was still a ceiling there.

This is why I think billing for time really stinks.

When you’re billing for time, you have to actually sit there and spend the time doing something in order to make money.

“No kids, sorry, can’t play. I’m making a lot of money. But unfortunately, I have to sit in this chair forever to do it.”

So here’s a simple question:

“Why would your clients care how long it takes you to do something for them?”

Let’s say they want you to design a website. If your client could have that site done in an hour, don’t you think that’s what they would want? They’d want it done as quickly as possible.

They don’t want a website that takes 40 hours to build. They just want a website that’s done. Until it’s done, it provides ZERO value to them.

The only reason they care about how long it’s going to take, is because our ancestors (and we’re guilty too) have trained them to care. A lot of service providers bill for time. So now clients are trained to ask “how long” it’s going to take.

There’s a better way.

Billing for time penalizes you for performing your service or skill quickly. That’s just bass ackwards if you ask me.

To switch things up though, you have to develop the ability to extract some special information from your client.

With the right information, it’s far easier to make a case for charging more for doing less. But you have to do it right.

I’m of the opinion that charging for time as a long term business strategy is not smart. And I’ve experimented a lot with alternatives (billing by the project, by value, etc.).

If you’re currently billing for time, just start asking yourself how your life would be if you stopped. How would your life be if you could charge double with 40% less work?

Is that even possible?

You’ll never know if you don’t let your mind entertain it as a possibility.

When you start asking questions like these, answers have an uncanny way of appearing.

See you next time,

Jason Leister
Editor, The Client Letter
Creating Success for Independent Professionals
ClientsSuck.net