With the advent of digital transformation, traditional business management methods such as invoicing and transaction archiving have evolved to meet modern requirements. Today, for professionals and entrepreneurs, the use of a certified invoicing system is not just a measure, but an obligation, particularly for those subject to VAT.
So what does using certified invoicing software really entail? In addition to simply issuing invoices and estimates, it also means guaranteeing data retention, ensuring that it cannot be altered, and providing a certificate of compliance to the tax authorities. In this digital age, choosing a certified software publisher for cash register management and invoicing has become an imperative to guarantee compliance and peace of mind for businesses.
Basically, every service company, whether providing services or selling products, can define its own price lists to offer quality service to its customers. These lists play a crucial role, not only in determining the selling price, but also in assessing the commercial margin in relation to the purchase price. The aim is to provide a framework for content and pricing, so as to better control the budget and guarantee adequate service. These pricing grids are essential in financial reports, particularly for comparing sales vs. actual figures, or for anticipating forecasts.
In terms of pricing strategy, we have identified two main trends:
- Creating a list of all the profiles or products you usually offer your customers.
- Designing a table detailing the phases required to produce a packaged offer.
Opting for detailed grids is a real optimization strategy. It facilitates payment and the sales process, as your staff save time when creating quotations. The prices, descriptions and quantities entered in these sheets remain modifiable when creating quotations on Furious. What’s more, with today’s technological edge, it’s possible to create pre-loaded content blocks directly on these templates, guaranteeing efficiency and precision.
In this article, you’ll discover the importance of these pricing tools in marketing strategy, how to create a standard pricing grid for your agency, and the major challenges facing agencies.
The importance of pricing grids
So you’ve heard of rate cards. But why is it so important for an agency to manage its rate cards properly? Can it affect the success of your business? [Spoiler: YES]
Rate cards can make a real contribution to the financial success of your business. If they are drawn up, used and regularly updated, it will be more difficult for your customers to try to lower your proposals, for example. Not to mention the time savings and reduced risk of errors this entails for your operational teams!
By setting standardized rates for your agency’s services, you also set clear expectations for customers. This in turn will have a positive influence on exchanges, and projects will prove more fruitful.
Finally, it prevents you from simply forgetting to cost something. By loading a ready-made template, it’s impossible to forget about project management, quality, reports, steering committees and so on…
How do you create a standard price list for your company?
There are a few key elements to bear in mind when setting up a pricing structure at your branch:
- Will you establish rate categories? For example, standard rates (default rates), negotiated rates, rates for non-profit customers, or rates for urgent requests.
- Will you establish differentiated rates according to the profile of your employees? A consulting director costs the company more than a project manager, for example.
- Do you already know the total cost of your full-time employees (FTE)? You need to include salaries and benefits to get this figure.
- Do you know your company's overhead cost per employee? This is calculated by dividing your company's overheads by the total cost of all your full-time employees.
Let’s take a closer look at each of these elements.
1. Is it necessary to differentiate rates according to the type of project?
Depending on the variety of services offered by your company, you may or may not decide to create different rate categories. Perhaps a standard rate won’t be enough to cover the costs associated with last-minute requests, for example?
Optionally, you can assign a fee schedule to a customer, allowing you to tailor prices to specific agreements. Thanks to quote automation, this grid will be automatically applied when the quote is created on Furious, simplifying the management of negotiated rates.
2. Should rates be differentiated according to profile type?
This question is usually answered by comparing the differences in costs per employee. Media or PR agencies often use a fixed price list for all their profiles. Differentiated price lists are mostly used in digital agencies or 360° agencies, for projects where several profiles collaborate on the same project over a set period of time.
Of course, on Furious you can accumulate as many price lists as you like, in day/unit/hour rates, simply by returning to the drop-down menu and selecting a new one.
It’s also possible to customize its content if required 🙂
Another tip: on Furious, you can also fill in your quote in load plan mode!
3. How do you create a profitable price structure for your agency?
Once you’ve calculated the total cost of your full-time employees and your overheads per employee, add 20% to the result. And that’s it!
The three main challenges facing rate cards
Setting up a price list for your business can be simple, but managing it properly isn’t always so easy.
Over time, your agency will most likely encounter common problems related to cost catalogs. Here are the three main challenges:
1. Obsolete pricing grids
A good practice to remember: update your price references every year.
Why should you do this?
Because your company’s main expenses (salaries and overheads) generally change every year, or even more frequently. This will help ensure that you remain profitable and competitive in the marketplace.
2. Inconsistent application of established agency rates
From time to time, we’ve all been known to offer an ad hoc discount, or worse, to agree to do a job for free in order to save a customer or a project. Although we’re in the business of providing services, it’s essential to respect your pricing grids in order to enhance the value of your service offering.
3. Update agency price lists in one place
To anticipate conflicts and communication problems, it’s important that you centralize the management of your price lists in a business management tool.
The main advantage of updating rate schedules in one place is obvious: everyone has access to the latest rates for your company’s services. This avoids confusion and errors when it comes to billing for services.
Perhaps you’re part of an advertising agency? Or perhaps you work for a digital agency, an ESN or a software publisher? Depending on the type of business you run, your pricing structures will differ.
The key is to standardize the rates for your company’s services, and ask your staff to update and monitor these rates to maintain your financial health.
To find out how to create and set up your price lists in Furious, contact the Success team!
