In industries where the difference between billable and non-billable hours is important, it is essential to track each one correctly to keep your project and bottom line on task. Choosing the right software and using the right procedures can make tracking them easy and stress-free.
How Are They Different?
The difference between billable and non-billable hours doesn't seem important on the surface, but not properly tracking the two can be a big mistake. These numbers are how you gauge your revenue on each project and, to be successful, even the five minutes you spent assuring the client that you have everything under control counts. So how are billable and non-billable hours different?
Billable hours are the hours spent specifically working on a project. They also include the time spent for initially invoicing the client for the work. Non-billable hours are the time you spend working on other things: emails, phone calls, and fixing errors. Meetings can fall under both categories – non-billable if you are meeting with your internal team or billable if your meetings include the client.
How Do Software and Procedures Help?
Tracking billable and non-billable hours can be a tedious task. A lot of manual labor goes into plowing through time sheets to find out what you can bill to the clients and what you can't. And although you don’t have to show the non-billable hours to your clients, giving them accurate and truthful billable hours is the only way to do business ethically.
Choosing to get a software program to sort your billable and non-billable hours can save hundreds of hours on invoicing and payroll. Once you set up the correct procedure, the software program simply takes the data you feed it, separates the two categories, and creates an invoice that is client-ready.
Not only does this save you in labour, it also eliminates the worry of human error. If you accidentally don’t bill for time, you usually eat the cost of that time. With a good software system, however, and the correct procedures in place, you can account for every minute. In addition, you can set up alerts to warn you of potential lost time – before the software generates the invoice. That allows you to correct the error before you send the invoice, ensuring you get paid for the work you have done.
To find out more about a software system that tracks billable vs. non-billable hours, contact Asyma.