How to Create a Billing Rate for a Second Service Type

You have been charging one rate for one kind of work. Now you are adding something different. Maybe strategy on top of execution. Maybe training on top of design. Maybe retainer support on top of project work.

Your existing rate was built around your existing work. It does not automatically transfer.

Why the Same Rate Is Usually Wrong

Different service types have different cost structures. A production task might be fast with clear outputs. A strategy engagement might be slow, require more preparation, carry more client risk, and produce fewer tangible deliverables that justify the hours.

If you charge the same rate for both, one of them is underpriced. Usually the strategic one.

Before you set a rate, you need to understand what makes the new service different from what you already do.

Pull Data From Work You Have Already Done

Even if you have never formally offered the new service, you have probably done pieces of it. You gave advice during calls. You helped a client think through a problem. You wrote a strategy document as part of a larger scope.

Go into Time-Trak and search your time entries for anything resembling that work. How long did similar tasks actually take? What did you bill for them, if anything? What would you have charged if that had been the entire engagement?

Real data beats estimation. Even imperfect historical entries give you a baseline.

Calculate Your Floor Rate for the New Service

Your floor rate is the minimum you need to charge to cover your actual cost, including your time, any tools or overhead specific to the service, and the admin that surrounds it.

For the new service type, list out what a typical engagement involves. Preparation time. Delivery time. Follow-up. Revision rounds. Client communication overhead. Add those hours up and multiply by what you need to earn per hour to make the work worth doing.

If the answer is higher than your current rate, price higher. If it is lower, do not automatically go lower. Market rate and positioning also matter.

Set the Rate Inside Your Project, Not Just in Your Head

Once you have a number, put it into Time-Trak immediately. Create a new service type or billing rate entry for that category of work before you start the first project.

This does two things. It forces you to commit to a number instead of leaving it vague. And it ensures that every hour logged under that service type calculates correctly on invoices without manual overrides.

If you have a client who will be receiving both your original service and the new one, set up separate billing rates per service in the project. Do not average them into a blended rate unless the client specifically requests that and you have done the math to confirm you still come out ahead.

Test It on One Project Before Locking It In

Propose the new rate for one project. Track every hour in Time-Trak. After the project ends, run a report and look at your effective hourly rate. Did you make what you expected? Did the work take longer than your estimate?

That first project is your real data point. Use it to refine the rate before you quote the next client.

Keep the Rates Separate in Your Reports

Once you are running both service types, report on them separately. This is where having clean project categories and billing rate assignments in Time-Trak pays off. You can see which service is more profitable per hour, which one has higher revision overhead, and which one you should be pushing harder in new proposals.

Rates are not permanent decisions. They are starting points based on the best information you have today. Track the work, review the data, and adjust before the next quote.

Track your time, bill every minute.

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