Should We Bill for Client Calls Like Lawyers and CPAs?

Nov 18

Written by: John Sciacca
11/18/2013 1:21 PM  RssIcon

I remember reading John Grisham’s novel, The Firm, several years ago, and recall Mitch’s marching orders from the nefarious firm of Bendini, Lambert and Locke as being something akin to, “If you talk to the client on the phone, bill them. If you make a photocopy for the client, bill them. If you even find yourself at your desk, drinking a cup of coffee and maybe flipping through a magazine, and your mind happens to wander to where you even think about the client, bill them. In fact, just thinking about billing the client, you should probably bill them to be on the safe side.”

While this constant billing would certainly be good for the bottom line—I mean, who amongst us hasn’t laid awake at night obsessing over a project? Wondering if we remembered to pull every cable we needed, or how we are going to program our way out of a particularly tricky problem. That would be a few extra hours of billing a week easy—is it in the best interests of your company to have a lawyerly attitude to billing?

My post last week titled “Why Recurring Revenue Service Contracts Don't Work for My Company” produced a comment that I’m using as the springboard for this post.

Dallas Dingle wrote: “My girlfriend is a CPA and she feels there should be a way charge clients for all the telephone assistance we provide. She is around on weekends and evenings when I grab a call and start troubleshooting with a client. As most in our industry know this can be a 24/7 job. Many problems are resolved over the phone, so no further revenue is added from these interactions. I know that we get a ton of referrals from existing clients, so I (mentally) write off the phone time as good advertising.

I think that we can all empathize with Dallas regarding the amount of phone assistance that we provide to both customers and non-customers alike on a daily basis, and certainly a boundary needs to be established when clients are calling you at all hours of the day. But I’m sure that Dallas’ girlfriend would be shocked if she knew just how much time we spend helping clients out pro bono. In fact, if I had a $1 for every time I just walked someone through resolving some issue with their cable box—“Yes, ma’am, I’m sure it’s your cable box. Just trust me, and I’ll walk you through the process of rebooting it…”—I would easily have enough extra money to get a sweet new iPad Air. And I mean the 4G one with 128 Gigs, not some wimpy 16 Gig, entry-level model.

Sure it’s frustrating sometimes. Walking people through the process of getting into a set-up menu to fix something they messed up, or adjusting an aspect ratio that is stretching the score ticker off the screen, or helping them get back onto the right input, or figuring out that they can’t see anything because somehow the receiver’s “Pure Direct” button magically got pressed even though they assure you that no one has touched the receiver… There are myriad things we do at no charge on the phone each day to support the systems we’ve installed. (At least the Tape 2 Monitor button is finally gone though, am I right?!)

And the truth is, it would be quite easy to just say, “I’m sorry, but this isn’t something we can fix over the phone, but I’d be happy to set up a service call for you. When would be a good time for me to have a technician come out?” and rack up a billable service call. But I take the same long-term view of Dallas that these phone interactions result in referrals and good will from clients, paying greater dividends in the long run than the short-term pay off of a single service call. I’ve had several people come in and tell me that they continue to use our company because we provide such great phone support, and they feel like if they get something that doesn’t work, we’ll help them figure it out.

Further, sometimes it’s just easier to help the client on the phone—for free—than to have to roll a service call into the schedule. Also, when you figure out what goes into these simple calls – our current rate is $70—they are often just break-even affairs when you factor in the drive time to-and-fro, the employee’s wages, the high cost of fuel, creating and mailing an invoice, etc.

Even more importantly, though, I think sometimes we forget to reverse the role and put ourselves in the client’s position. If you called up someone for some help on something you purchased, spent 10-15 minutes on the phone with them and then got a bill in the mail, how would you feel?

I can tell you exactly how I’d feel, because this has happened to me multiple times with our accountant. We’ll get some letter from the IRS or I’ll have an issue with our accounting software and I’ll call to ask a question, and then I’ll get a bill in the mail for a fraction-of-an-hour of “professional telephone support.” I pay it, but I tell you, it pisses me off to no end each time and I assure you that when I think of my accountant, what comes to mind isn’t a warm and fuzzy and, “Man, I love working with that guy! I need to tell all my friends about him!” feeling.

Sure, we might be able to monetize these phone calls, but potentially at the cost of developing a, “Yeah, my audio guy will help you, but he bills me for every question I ask,” reputation.

One of my product reps suggested that we try and monetize some of our remote support by being able to remotely log-in and reboot a client’s network or various connected components. The ability to do this costs the dealer nothing in that the manufacturer offers this cloud-based access at no charge. And it’s true; this remote power cycling can often fix a problem. But is charging for what literally amounts to pressing a button “worth” more money than the, “We designed your system so well, that we built-in the ability to provide you this level of off-site support to solve these simple issues and keep your system up and running. Be sure and tell your friends about us!”

The thing is, if you charge people every time they call you or have a question, sure, you’ll make some extra money and you’ll likely get them to stop calling. Completely. While we could bill like attorneys, who really likes dealing with their attorney? Sometimes, the money you don't make now will end up making you more money down the road. John Sciacca
 
 
 
 
John Sciacca is principal of Custom Theater and Audio in Myrtle Beach, SC.
 

6 comment(s) so far...


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Damned if you do and Damned if you don't

Grr, 6 of one and a half dozen of the other.

How about a certain time period or number of calls before the clock starts ticking?

I am sure others will chime in...

By TimmyS on   11/19/2013 10:57 AM
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Maybe with a little finesse...

I'm part owner of a design consulting firm, and our product is, literally, our time. I can see both sides of this issue. In general, we will be much more lenient with current clients or potential new clients whose needs are a good match for our skills. Over time, I've learned to sniff out tire kickers who are simply looking for technical information for free and with little possibility for us to capture actual business.

Anyone in the business knows it's often a fine line to walk between good customer service and being taken advantage of. I usually try to err on the side of giving folks the benefit of the doubt, and then try not to get fooled by the same person more than once ;-)

By Mike Sims on   11/19/2013 1:02 PM
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Re: Should We Bill for Client Calls Like Lawyers and CPAs?

Why not use the phone contact as an opportunity to interact with the client? You could suggest upgrades, new technologies, etc. The fact that you solved their immediate issue should reaffirm your ability to support your products after the sale. And make them want to do more business with you.

I know that time is money but how much money does it cost to drive a client to make contact with you? It's a proven fact that the least expensive customers to attract are the ones that you have done business with in the past.

We are not lawyers or accountants.

By Paul E on   11/19/2013 2:39 PM
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Re: Should We Bill for Client Calls Like Lawyers and CPAs?

Thanks John. Great article.

I am old school on this also. The client purchased goods or services from us based on a perceived and understood trust in us and our companies. That's why we got the check. Well, at least part of the reason.

There were other reasons like knowledge, honesty, etc. and many others that were represented to the client and he or she believes in you, so they give you a check, which is the ultimate belief confirmation we can receive.

The calls for questions or comments is our chance to pay back for all the non monetary things that we used to get the client's initial trust and confidence such as honesty, integrity, etc. It is that good energy trade with good energy. I make this a concerted effort. This keeps my client's calling back.

I suspect from following your blog, that you are well respected, knowledgeable and highly competent person in your field. When your clients call you, this is what they really want to tell you through their questions.

Regards,
Mike

By mikesorensen on   11/19/2013 3:22 PM
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Re: Should We Bill for Client Calls Like Lawyers and CPAs?

I agree in principle with the pro bono phone support but I have also had clients who constantly phoned as a result of staff messing up and then losing the client when someone blamed the system at a staff meeting with a comment when we had such and such in my last position it never gave trouble, New system installed same issues but client lost and too embarressed to come back

By Michael Sheehy on   11/20/2013 2:44 AM
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Re: Should We Bill for Client Calls Like Lawyers and CPAs?

I don't ever bill for phone time. Often times it is time that I am on the phone trying to diagnose an issue with a system that we installed. I just don't feel right about billing for that. I usually enjoy talking to my customers and trying to educate them on what they are thinking about buying. Maybe this time they will buy from some one else but the next time me. Margins in this industry are getting tighter and tighter and we are all looking for places to get our margin back. Not sure this is the way?

By Jon Herbster on   11/20/2013 5:50 PM

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