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#592: Charge Wisely for Travel Time

Posted By Mark Haas CMC FIMC, Tuesday, June 21, 2011
Updated: Tuesday, June 21, 2011
I have a few clients for whom I have to spend a few hours per month on a plane. Should I be charging for travel time?

This is truly something that should be worked out in your consulting agreement before the project starts. If you are working during travel, then this question is moot: you are working on behalf of your client so you can legitimately charge for hours worked. This will likely be at full rate if you believe you are working at full productivity.

I presume, however, you are referring to time you are not working for a client but are prevented from billing any other client. If you take a morning flight of several hours, then half a potentially billable day is lost. On one hand, you provided no services to a client so the client might claim you should not be paid. On the other hand, the travel was needed for you to be on site to provide services you couldn't otherwise provide off site. Recognize that a hard line on either position is likely to create some tension.

How you resolve this depends on how well your client trusts you and how much travel involved. If your client is generous, then travel both ways might be chargeable. However, a fair approach for most clients is to split the difference and pay for half the travel, assuming you are traveling and not working for another client or on your own firm's administrative duties during that time.

Tip: Talk to your client and come to an equitable arrangement. Explain your rationale and why you are willing to share the cost (since you are incurring real costs). However, make absolutely sure that you are being ethical and not being paid to travel by one client and charging another for work you are doing on the plane - double billing for the same time.

© 2011 Institute of Management Consultants USA

Tags:  fees  goodwill  practice management  travel 

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Comments on this post...

Michael E. Cohen CMC MBA says...
Posted Wednesday, June 22, 2011
An excellent response. Of course this refers mainly to a time and materials, as opoosed to a fixed price contract. While your reponse is logical, another equally reasonbale approach is to not raise the issue wiht the client in advance and not disclose your policy unless and until the client raises the issue. There are many factors that go into the approach, including, but not limited to, your billing rate and the amount of inconvenience. My policy is to charge for travel on both ends, but then I think my billing rate is modest. In the early stage of my career, a partner at Booz Allen said in a new Associates course to minimize the amount of detail provided in proposals on billing details, so as not to distract the client from the primary objective of providing outstanding services and value to the client.

When I hire subs, they often have different polices on how they bill for travel time. I generally just take whatver they offer, as long as it is reasonable.
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Robert D. Betka Jr says...
Posted Wednesday, June 22, 2011
This issue is moot if you are charging a fixed fee for value received by the client for your services. I travel regularly and have never had the issue come as most of my engagements are fixed fee. On the other hand, in my early Big 6 days, the policy was to charge any time you are actively working on a client engagement, and travel time if it was more than 1/2 a day. The clients understood the arrangement. The comment above about being fuzzy with billing detail seems to border on unethical to me.
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