All-Inclusive Rates

Do all inclusive rates bug you the way they bug me?  Clients want to know and understand the total cost of hiring us, but then complain because it costs more for us to travel.  They compare my all-inclusive to a local resources standard rate!  That isn’t fair!!  If they want local only, then ask for local only and be satisfied with the results.  Don’t expect me to fly half way across the country for the same fee that you  would pay a local twit.

OK, so what exactly is all inclusive anyway and how on earth is it computed?  Our rates are made from 3 basic areas: Standard Fee, Self-employment costs, and Travel.

Standard fee would be the equivalent of an annual salary.  I say equivalent, because I believe that clients should pay a premium to hire an expert who has the guts to go it alone.  I think an additional 15-30% is appropriate, depending on your client skills and kahunas.

Self-employment costs are all those ‘benefits’ that you would get from a corporation if you worked for them, plus those added costs required to do business as an individual.  These would include, but are not limited to:

  • Retirement Plans
  • Health Insurances
  • Legal Counsel
  • Business Insurances (Liability, E&O)
  • Life and Disability Insurances

Finally, there are travel costs.  Without getting carried away, we must handle airfare, lodging and a meals as minimums.  But don’t forget that travel can also involve parking, rental vehicles, and other incidental charges you may want or need to build in.

W-2 Rate = Standard Fee

Standard Rate = Standard Fee + Self-Employment Costs

All-Inclusive Rate = Standard Fee + Self-Employment Costs + Travel Costs

Don’t let anyone short-change you!  Your standard fee is negotiable, but the other costs typically are not.  You can calculate self-employment costs down to an hourly rate. It only fluctuates on an annual basis. Travel costs should be calculated per client, based on location, and then be turned into an hourly rate as well.

Stand your ground grasshopper!  Remind the client what they are asking when they say all-inclusive.  Explain how you are trying to save them money on the costs as much as you can, but you are not giving away your talent.

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