If we’re going to talk about billable hours and why they’re important, we also need to chat about non-billable hours.
First, what are non-billable hours? Well, they’re simply any amount of time you spend at work that can’t be billed to your clients. These things are usually admin work but can also include:
Secondly, why are they so important? 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.
But, how do you make sure you’re getting the most out of your non-billable time? To start, you can track those hours so you can see their real value. Here are some of the main benefits of tracking non-billable hours:
Non-billable hours remove inefficienciesBy tracking how much time you spend on tasks that you can’t bill to anyone, you can see how much you are paying your team versus how much you’re accruing. Plus, it helps you see how your team spends their time, meaning you can better minimize hiccups or slowdowns in your process.
Non-billable hours help foster growthHow much time does your team spend looking to better themselves for the company? Non-billable hours are an excellent way to determine that. You can better track how much time everyone spends cracking away on projects versus how much time they spend researching industry trends and studying up on their specialty.
Non-billable hours help you see where the money isBy tracking both billable and non-billable hours, you can better understand how much each of your clients is costing you and which ones are the most profitable. This can help you better quote clients in the future and possibly help you balance the time spent on certain types of work to foster growth.