By knowing how to properly price for their services, services companies can offer clients a value-based, fixed-price billing model. According to an article on accountingWEB.com, developing such a model requires knowledge of three critical elements of costs: personnel, technology and contingencies.
To better manage their costs, a growing number of companies are adopting activity-based billing, according to an iGR survey cited in an article on CFO.com. Activity-based billing gives organizations great flexibility because they’re not paying a flat fee every month; you pay for what you use. Companies wanting to shift to this model have to be mindful of how this could potentially make costs go up.
Though it’s not a new concept, many firms are just now embracing the idea of value pricing, according to an AccountingToday.com article. The consulting industry has been trying to figure out a way to do value billing for a long time. With value pricing, having a very clear project scope is critical from a project management perspective for both the provider and the client.
Outsourcing your payroll processing can cut costs, according to an article on Business Finance’s website. Companies can save as much as 85 percent by outsourcing payroll and the subsequent reduction in headcount of employees who performed those tasks. Outsourcing eliminates the need to have an in-house person to handle withholding, insurance, benefits and direct deposit.
A Business Computing World article outlined five ways to boost accounts payable efficiency, including imaging supplier invoices electronically and automatically circulating information around companies. Other tips include boosting efficiency by embracing mobile technology, using optimal character recognition and choosing e-mail over traditional mail whenever possible.