One of the most common challenges appraisers face can be easily overcome.
It’s the most simple of concepts, but seems to be the hardest thing for an appraiser to do.
Ready? “Bill for all of your time.”
That’s it. Stop eating hours that you put into a job, and start billing your client for the work you performed.
As a professional appraiser, if you did the work, and worked effectively, then you deserve to be compensated. I know all the excuses for not billing for all of your time. I used to use them in the past. We’ve all heard them from almost every appraiser we know.
“I took longer than I estimated”
“They would never pay the bill if I billed for all I did.”
“The item wasn’t worth that much.”
“I’ll make it up in good will.”
“The research took longer.”
“There was more stuff to appraise than we thought.”
Your main “Product” is your time and expertise. Why would you give away the only thing you have to sell? Sears doesn’t give away free refrigerators. Home Depot doesn’t give away free lumber.
So how do you stop giving away the store? Here are three tips.
1) Have a written agreement for every job you do. A written agreement or contract lets your client know what to expect. It will specify your rate, and what you will bill for (research, admin support, on-site time, travel time, etc.). And, always provide a ‘non-binding’ estimated total fee. It will make it emotionally easier for your to write the invoice properly, and completely.
2) Track your time for every job on a time log or time sheet. If you’re like most appraisers, you will be astounded to discover how much time you give away on each appraisal job. By tracking billable time on a time sheet you’ll know what to bill. It helps you record the actual time on an invoice. This practice will also make you a better estimator of on-site and research time for future agreements and contracts.
3) If you absolutely can’t accept the idea of billing your clients for all the work you’ve performed, then here’s a starting point. Invoice your client for all your time then discount the bill or a portion of it. For example, if it took you 43 hours of research, but you can’t accept that time as billable (even though it truly is)
document the 43 hours then ‘pro-bono’ some of those hours with a ‘professional courtesy adjustment.’ Some appraisers discount their rate, but that may create the perception that your time is not valuable. Most appraisers that ‘adjust’ invoices do so through the ‘pro-bono’ method.
Let me know what non-billing excuses you’ve heard and what you’ve done to overcome the challenge. We’ll share them with our e-newsletter subscribers. Drop me an e-mail. We’d love to hear from you.
Keep in touch.