THE JOY OF PROJECTS
(March/April 2004 Issue)

I hope my readers won't yawn when I extol, once more, the importance, value, and benefits of Project-Based work with clients. By project-based, I mean a working arrangement where you charge one fee for the whole project -- as opposed to working and billing by the hour like attorneys, accountants, etc., do. I've long known the economic benefits of this arrangement, and recently I discovered an emotional one: joy, a hidden joy for you in that system.

I consistently advocate for this type of payment plan. (For previous articles on this topic, email me a request for #07 - Setting Fees, and #42 Hourly vs. Package.) Here's what got me to see the joy in it: A career advisor whom I'm coaching in Private Practice* said, "It felt wonderful to wake up on January 1st and know I'd enter $6000 worth of charges to my bank account that day."

Ahhh. I have the same joyous feeling. The first of the month is "payday." You see, while you charge for a whole services package you don't collect the whole package up front. By "services package" I mean agreeing to work with a client all the way through to an actual new job or promotion (with an outside time limit of 12 months).

Let's say you’d expect to work 20 hours with a person. Per hour, you'd collect, say, $3000 over those 20 meetings. With a package, you agree on a $3000 price and then no longer count the hours. If it takes you 10 great! You make $330/hour. If it takes 25...oh well, you make $120/hour, but either way you don't have to watch the clock. But do you collect all $3000 right away? No! The payments are spaced out in an affordable fashion for your clients. I usually spread them out over 4-6 months. So, on the first of the month, when I process several charges from several clients it feels like payday!

Also, I avoid any problems chasing my clients for first-of-the-month money or collections, because I don't take checks. I just take a credit card number and process a charge around the first of a month.

By the way, whenever I've deviated from this for, say, a client who cut up their credit cards for instance, I've always regretted it. I find it very awkward to call someone when their check is late; it gets in the way of the counseling relationship. (For more info about accepting charge cards and what you have clients sign, etc., email me a request for article #22 How to Avoid Asking for Money.)

With automatic charges, on a month to month basis you'll have a steady income. No worry about how many sessions you'll "sell" that month. No disappointment if a client cancels an appointment. No embarrassment asking them to pay for missed appointments. And in the rare event that a job campaign goes longer than 12 months, you're all set up to continue monthly credit card charges as long as they want to keep working with you. (I charge people an additional $250 per month on a month-to-month as-needed basis to extend their contract.)

So to summarize…
ONE FEE works better because

• You're motivated to help the client get a new job quickly (fast makes you more money than slow).
• Your client is motivated to use you to the max.
• The better (faster) you are, the more you make per hour.
  
• You're certain of the client's commitment level -- to see it through to the end.
• No worry that clients will disappear toward the end to save a few hourly bucks and miss out on, say, salary negotiation coaching.
• You can be 100% candid with clients and not worry you'll lose their business.
• You don't have to sell, sell, sell the next session.
• You can be very, very thorough, take extra time when needed, and not worry the client feels like you're padding your wallet.
• You can still reserve the right to charge hourly if you think the person is particularly challenging and because of all the time it will take you're worried the package fee would be to big.
• You'll get more business because clients stick with you all the way through to success, and success brings referrals better than anything else.
  

LASTLY, this month's insight: You'll feel more secure in your practice because you get a joyful paycheck on the first of every month!

Jack Chapman is author of:
Negotiating Your Salary: How to Make $1000 a Minute
He is a career consultant in private practice and runs ongoing support and training teleconference sessions for career consultants in private practice.
He can be reached at 847-251-4727 or jkchapman@aol.com