Calculate Billable Hours: Chapter 5 Setting a Path to Maximum Profitability Contractor Playbook

how many billable hours in a year

Billable time is lost as we transition from one matter to another. Our ability to log hours to our clients is diminished when we’re constantly required to shift our attention from issue to issue.

  • Some industries implement billable hour requirements or quotas.
  • The last thing relevant to tracking billable hours is sending the invoice.
  • If we were a staff aug firm like Anchor Point, the expectation would be 40 billable hours minimum – no exceptions.
  • As you can imagine, it would be almost impossible to run a business without some non-billable work going on, no matter what type of company you run.
  • Saviom, a resource management and workforce planning software.

Since some non-billable hours help speed up the project, it is good to track this, so you can know how much non-billable time is required for a particular project. If more non-billable hours are required for a project, you may be working at a loss. You may need to renegotiate with the client or add the non-billable hours to the invoice and let the client know why you need to be paid for these. While they were tracking their working hours for the last month, they realized that, out of the total hours, 30% were non-billable hours. Lawyers can track billable hours with a billable hours chart, which will save them the time, effort, and frustration of calculating the hours manually.

Set Your Hourly Rate

You will get paid for what is worth without underselling your services. You can track and record all the hours spent on the project and then separate billable and non-billable hours or you can simply record billable hours and leave out non-billable hours.

how many billable hours in a year

And those clients are typically easier and more fulfilling to work with. This can eventually help you cut back on non-billable tasks and increase your productivity.

What Can You Do With Time Doctor?

We’re talking about just your standard year-end performance bonus. Not…I did everything that was asked of me and I did it correctly. You may even be wondering why you should care about how many billable hours you have if it’s only making the firm more money and not you.

As stated in an annual survey by PR merger and acquisition consultancy Gould+Partners, PR firms improved their average hourly rates in 2018, compared to 2017. If a consultant has a total of 2,500 billable hours, we’ll divide this number by 2,000 . For instance, if there are too many internal billable hours meetings, this can result in more non-billable hours. One of these reports is The 2017 Legal Trends Report, a survey done by Clio, which included around 3,000 legal professionals. According to this research, out of the 8-hour workday, only 2.3 hours of the day were marked as billable.

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