Consultant Simple Guide

1. 4/24/2012
PRIVATE
CONSULTANT Methods of Billings for Consultancy or
BILLING Services
GUIDE
Prepared By: Milton- email:Milton-ochieng@hotmail.co.uk| Milton

2. A.
Methods of Billings for Consultancy or Services :
Revenue Billing Method 1. Doubling/tripling your hourly wage of lead
consultant
Name Cost Wage Benefit Admin Expenses
Director 300,000.00 50,000.00
Business - - - -
Development
Staff - - -
Staff - - -
Staff - - -
300,000.00 - -
Total Hours 192
Income Per Hour/Month 1,822.92 X2
Hourly Income 3,645.83
Income Per Day 29,166.67
Monthly Billing (USD) 758,333.33
Concept based on doubling and Tripling The Consultancy Fees, such that a third rule applies
to Expense and Administration Cost
**** Double or Triple the Lead Consultant wage+ benefit

3. B.
Revenue Billing Method 2.
Setting a daily rate for consulting (per diem rate for consulting)
(USD)
Number of Hours Worked 960
Hourly rate USD 3,437.50
Daily Billing 27,500.00
Monthly Billing 715,000.00
Name Cost Wage Benefit Hours Hourly
Rate
Director 300,000.00 50,000.00 192 1,822.92
Business 120,000.00 - 192 625.00
Development
Strategy 70,000.00 192 364.58
Finance and 70,000.00 192 364.58
Administration
Strategy/Marketin 50,000.00 192 260.42
X
y
Total 660,000.00 960 3,437.50

4. C.
Revenue Billing Method 3.
Setting Consultant Fees by the Project
USD
Value addition 800,000.00
****** consultant has the discretion to cost his or her service based on prior experience,
skills, expertise and time and resources committed to service.******
D.
Revenue Billing Method 4.
Setting consulting fees based on performance
Base rate plus 560,000.00
Performance pay 168,000.00
Share of ownership 25,000.00
Monthly Billing 753,000.00
Name Base Rate Performance Share Total Pay
Pay Ownership
Director 300,000.00 90,000.00 25,000.00 415,000.00
Business 100,000.00 30,000.00 130,000.00
Development
XYZ 60,000.00 18,000.00 78,000.00
YXZ 60,000.00 18,000.00 78,000.00
ZYX 40,000.00 12,000.00 52,000.00
Total Monthly 560,000.00 168,000.00 25,000.00 753,000.00
Billing
Billing method based on:
******* Base Rate Fees
******* Performance Pay
****** Ownership fees

5. E.
Revenue Billing Method 5.
Setting consultant fees strategically using real-life data:
Setting a consulting fee based on working days
Days Hours
Year 2304
Months 192
Hours 8
100% possible hours:
- 20% spent on administration, running errands, paperwork, etc
- 20% spent on marketing, networking events, website management,
etc
- 10% spent on other non-billable
work
50% spent actually working for pay
192 hours x 50% utilization rate = 96 billable hours
Considering bad debt rate as part of your consulting fee:
Collection rate= 95%
96 hrs X 95%= 91.2 hours
Rate of Pay as Basis for Consulting
Fees:
How much would you earn if you were paid a salary at a company?
Salary 280,000.00
Benefits 50,000.00
Net 330,000.00
Hourly Consulting Fees:
Salary / Billable Hours = Hourly Consulting Fee
355,000 / 91.2= Ksh. 3,618.42
3,618.42
Overhead rates for consultants:
Rent or mortgage interest -

6. Utilities
Maintenance and upkeep 30,000.00
Property taxes -
Internet 8,500.00
Telephone 12,500.00
Cell phone 10,000.00
Office gadgets 2,000.00
Internet connection
Laptop or desktop computer
Printer 3,000.00
Shipping and postage 2,000.00
Printer toner/ink 7,000.00
Home office supplies 4,000.00
Paper 2,000.00
Accounting
Legal services -
Office furniture
Business licenses and permits 3,000.00
Insurance
Subscriptions 3,000.00
Professional associations 3,000.00
Meals and entertainment for professional purposes 10,000.00
Continuing education -
Professional meetings, conferences and tradeshows -
-
Wages 260,000.00
Total 360,000.00
Man Hours 768
Divide the total cost of your overhead by your billable hours:
360,000 / 768= Hourly Rate 468.75
Hourly Rate:
3,618.42 + 468.75= 4,087.17
Profit margin and consulting fees:
Total Hourly Charge + Mark -UP 10% (4,087.17+ 454.13)= 4,541.30
Mark Up=

7. 4,087.17 X 10% Mark UP = 4,541.30
Monthly Billing ( 8Hrs X 6 Days X4Weeks X 4,541.30 )=
871,954.56
Prepared By:
Milton Onyiro
For Further Enquires contact - Milton-ochieng@hotmail.co.uk