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There are certain rules for keeping and courting clients, one of which is professionalism. Clients are more likely to work with you if your small business gradually builds a more reputable image. But this just segues into another question: What exactly makes a company professional? There’s a sleek website, active social media presence, punctuality, but those are just the most basic examples. As your company grows, you will find that it’s the little, less obvious things that make one company more professional than another. A chief example is small fees or extra charges, which might actually be more likely to send a client away than a big fee.

Think about it: Clients typically have no problem paying thousands of dollars in fees for professional services but will likely complain over an extra $5 for mailing charges, delivery services, or parking expenses. Companies that are looking into small business loans might want to consider using the funding to handle more fees themselves rather than potentially upsetting new clients.

Signs Your Business Is Being Overcharged

Let’s say you are remodeling your home or office and have therefore enlisted the help of a furniture company. The job is large, so you can understand why it comes with a large cost. But then you realize that the company is charging you three delivery fees for three appliances, even though all three only required one trip. This is comparable to a law firm attaching a fee for photocopying documents. In both cases, you know you are being overcharged for the small fees, which gives you the impression that you are being overcharged for the overall bill as well. Potential clients are already wary about cost, so anything that makes them think they are paying too much is a risk to their loyalty.

Where Did You Get That Number From?

Another type of small fee that could upset a client involves perceived value, or a specific value that is hard to prove. There’s clearly nothing wrong with the furniture company charging more if you buy more of something, like carpeting. But when you get the bill, you find out that an additional charge has been tacked on to the carpeting job because the amount of carpet you ordered required the company to move your couch. Yes, it took a little extra time to move the couch, but what kind of system could the company use to determine how much to charge for that specific task? Odds are, the client is not going to understand the rationale for charging a certain amount for moving a couch. If you can’t explain why a small fee exists, you are better off factoring it into the overall charge.

Reasonable And Easy To Understand

Small fees are justifiable when they are reasonable or easier to understand, like court costs to a legal bill or an extra few hundred in print shop costs for a graphic designer. These fees can also stem from extra services that are not given to every client. You’re not likely to return to a hairdresser who charges you extra for shampoo because you assumed washing your hair was a basic task. The hairdresser would be in the right, however, to charge extra for conditioner, highlights, or other extra services the customer has agreed to in advance.

If that hairdresser wanted to be seriously competitive, he or she might offer a conditioner for free because this is likely something almost all competitors charge for. Businesses that take on small fees that their competitors charge for must let their customers know in order to reap the full benefits of doing extra work. When the bill comes, the small fees should be listed as “complimentary,” with a zero next to the item. The success of this strategy can be observed in restaurants that stand out by giving small appetizers to every customer. There is no charge for the extra cinnamon rolls or plate of pasta salad but the extra work might go ignored if they weren’t included on the bill. Restaurants that are taking out restaurant business loans to remodel or introduce a new menu might want to ask for a little extra funding for complimentary items since this investment has likely achieved positive results for competitors.

Knowing What To Charge For Your Services

A big reason business lenders encourage smaller businesses to increase staff as they grow is because it provides a clearer picture of how much they should charge for their services. It’s common for owners of smaller businesses to be heavily involved in almost everything that’s going on, even though the business owner isn’t technically paid as a staff member. When you increase staff, the business owner delegates more tasks rather than taking them on him or herself. So, when determining what to charge clients, the business owner can simply factor in how much time each staff member spent on certain tasks and what each staff member is paid.

Decreasing confusion about fees smooths out cash flow, which is one of the primary purposes of putting together a larger team in the first place. This justifies the use of working capital loans that can help you quickly take on multiple hires without obstructing cash flow in the process. Using debt financing to hires will also give you a clearer sense of what employees are worth, making it easier for you to determine fees for their work. Eliminating unnecessary fees and making existing ones more accurate is crucial for growth, so it’s important not to overlook either task as you take on more work moving forward.

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