In a conversation this morning the topic of 'scope creep' came up. If you aren’t familiar with the term, as a Freelancer or small business owner you will be familiar with the practice. You take on a contract or project from a client to deliver x, yet as the project progresses, they also ask you to audit y, have a look into z. - sound familiar?
Often, we don’t charge for this work and include it as ‘value add’, a key part of developing that long-term client relationship.
However, if the ‘user’ and the ‘buyer’ are different people within the client organisation you need to find a way to highlight all this additional value that you provide otherwise at contract renewal time, if the purchasing department obtains cheaper quotes, all your ‘added value’ throughout the year can easily go unnoticed.
It reminded me of a practice I have used since my Account Manager days – The Zero charge invoice
.
The concept of the Zero charge invoice is to capture the monetary value of any work you provide, that you choose to give to the client at zero charge.
From telephone support, audits, extra staff training and even deliveries; anything that you could charge for and don’t – capture here.
Ensure that you submit these as formal invoices through your accounting system so they are captured by the client’s accounts department and will be reviewed by the purchasing department when making future buying decisions.
If you include the zero-charge work within your regular monthly invoice, show the full price and then adjust to a zero charge.
This simple practice is amazingly powerful customer retention strategy, not only providing a record of all the additional value you provide but also forms part of your discussion at quarterly/annual reviews.
From your own account management perspective it also provides your owns record of additional work provided rather than trying to remember everything you did at the end of the contract. Are these services which you could (or should) be charging for in future? Are there opportunities to create new service offers?
Now the customer, (
users, buyers and decision makers
) can see the full value of the services you provide throughout the contract, those cheaper alternatives may not look so attractive.
Janet Doran
, works as a Business Coach across Yorkshire, UK. enabling freelancers & micro business owners to stand out & win business in competitive markets.
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One of the key benefits business
owners get from working with a business coach is that ‘protected’ time to work
on the business instead of it in. If you are thinking about working with a business coach please get in touch and find out how I can help.Call 07505 120051
