If you're in the service industry, you will inevitably encounter time registration and will have to create invoices based on time tracking.
For example: you set an hourly rate per employee and after this service is done, you will need to invoice the hours that this employee worked. However, in most cases there are different interpretations of this flow. This is also the case in Teamleader Focus.
We will briefly explain how you can use hourly rates. There are two main ways you can do this:
- Selecting an hourly rate for all your customers (based on 3 different choices)
- Setting different hourly rates per customer or project
1. Hourly rate for all the customers:
First, you must decide how an hourly rate must be determined. Navigate to Settings > Invoices > Preferences > Set default invoicing preferences, and you'll have three choices regarding this:
A. Price per user
B. Price per work type
C. Fixed price per hour
The option you choose here will be your default invoicing preference for your Teamleader Focus account in general. Let's however zoom in a bit on the different options here.
A. Price per user:
In Teamleader Focus you can set the price and cost per user in Settings > Users > Three dots > Edit. When editing a user, you are given the option to set a fixed rate.
An external price can be set for each user in your company. This is often used to distinguish between, for example, a junior and senior profile. As opposed to the internal cost just above, the external price is the rate at which you will invoice the customer if you choose to invoice by price per user.
John works for 80 EUR an hour.
Martin works for 100 EUR an hour.
Both are designers and each has worked for 5 hours. Naturally, you want to invoice the customer for the time worked. The invoice will be provided with two invoice lines:
Price excl. VAT
|Design employee A
|Design employee B
Filling in the internal cost in the Users-settings is important if you want to use the profit function in your projects. Basically, all time tracking performed will be calculated with the internal cost rate so you get to see what your costs are versus your revenue, which is calculated with the external price if you invoice per user rate. Click the link for more information.
B. Price per work type:
You can also choose to calculate per work type. This will ensure that you can invoice development work as more expensive than analysis work.
Analysis work has an hourly rate of 65 EUR.
Development work has an hourly rate of 85 EUR.
Say 10 hours were spent on analysis and 5 hours on development. The invoice will be provided with the following two invoice lines:
Price excl. VAT
In Teamleader Focus you can set the hourly rate per task in Settings > Calendar > Work types. When adding or editing the work types, you can define an hourly rate.
C. Fixed price per hour:
Finally, it may be that your company has one unique hourly rate regardless of the work type or the user.
A company has a fixed rate of 90 EUR an hour.
Say 10 hours were spent on analysis and 5 hours on development. The invoice will be provided with two invoice lines:
Price excl. VAT
You can set a fixed price per hour for your company by going to Settings > Invoices > Set default invoicing preferences > Select the fixed price per hour option in the pop-up.
2. Different hourly rates per customer or project:
However, it may be that your company chooses to deviate from the standard method for a specific customer or project. Therefore, there may be exceptions:
A. On customer level
B. On project level
C. Changing the type of hourly rate
A. On customer level:
At customer level, you can set whether a specific customer is charged according to the three principles discussed above: price per user, price per work type or a fixed price per hour.
This way for other customers the default hourly rate will apply, but for this specific one, the specific rate that you choose will be taken into account.
For a contact or company, click on the three dots next to ‘Company information’ > Invoicing preferences > Next step, where you will see the following options:
Therefore, at customer level there are three options:
1. Price per user: the pre-determined price per user will be used when invoicing.
2. Price per work type: the pre-determined price per work type will be used when creating the invoice. (These are the values set in Settings > Agenda > Work types, and cannot be altered).
3. Fixed price per hour: If you change the hourly rate, the system will always ask if the unbilled time should be changed as well. You can also choose whether time tracking only applies as from a specific date. This can be handy with, for example, an index adjustment at the beginning of the new year.
B. On project level:
At project level, you can also set whether a project is calculated according to the principle of price per user, price per work type or fixed price per hour.
However, there can also be additional exceptions.
1. You decide to use an hourly rate per user but the hourly rate deviates for this specific project.
Example: John normally always works for 80 EUR/hour, but for this project you agree that his rate will be 85 EUR an hour. You adjust this in the project itself. Navigate to Project info in the header of the project, and go to the “Co-workers" box on that page. If you click on the three dots next to a user, you can enter an adjusted hourly rate.
2. The hourly rate per user changes during the course of the project.
Example: John works for 85 EUR/hour in project A. This rate, however, changes as of 1st of January to 90 EUR/hour because of, for example, an indexation.
From now on, all of John's work for project A will be billed at 90 EUR per hour. Before you start implementing changes, you will also be asked what must be done with the unbilled work. In other words, should the work from the past also be changed or only the work performed in the future?
3. You decide to use a fixed rate per hour and this changes during the course of the project.
Example: Usually you bill all work in project B at 100 EUR/hour. However, because of the complexity of the project, you arrange with the customer to invoice all unbilled work at 110 EUR/hour.
You can then set the new rate and indicate that all work from the past that has not yet been billed may be adjusted. You do this in the project itself > tab Project info > Three dots next to Project number x > Invoicing preferences.
Note that the internal cost you have added to the Users-settings of a particular user will always be used to calculate the costs of a project (if time tracking is performed), regardless of your way of invoicing.
C. Changing the type of hourly rate:
Say you have changed the type of hourly rate for a customer or project. For example, from price per user to a fixed price per hour. The system will also ask if the unbilled time from the past should be adjusted, either all of it immediately or as of a specific date.