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The Heating Company Analogy

Published by Chris Coyier

What helps a design business stay healthy and successful over time is having regular clients with regular monthly billable work. The one-off jobs might be more glamorous and more fun, but in the long run it's probably your regulars that keep the lights on.

With print work, projects are absolute. Once ink hits paper, you bill, and that's that. But with the web, projects remain malleable indefinitely. This is an opportunity for you as a web design business to offer the valuable service of monthly maintenance. This is a mutually beneficial scenario for both you and your client. The client gets a website that is always up-to-date, and you get steady monthly billable work.

Here are some things you could provide / offer a web client, beyond just initial design:

  • Hosting / Monitoring
  • Keeping content up to date
  • Adding / Developing new content
  • Long term SEO

But how do you bill for this?

My boss at Chatman Design uses what I think is a clever sales pitch he calls the heating company analogy.

Here is a quote on the billing system from a real oil delivery company:

SmartPay is designed to smooth out your monthly budget. By anticipating your annual heating fuel costs and service plans we can spread the payments over a longer period of time. There are no additional fees for this service. This eliminates more big bills during the holiday season when energy costs are high and other expenses are heavy. With a SmartPay Plan, you pay the same amount each month at the same time.

Nearly this exact model can be adapted to billing your clients for monthly web maintenance. Chances are, each month isn't going to be exactly the same in terms of what needs to get done on the web for that client. Some months you'll have new content galore, and changes abound. Other months things will be quiet. This is where the analogy kicks in.

You can explain to your client that rather than have each months bill be a surprise, you'll anticipate their average monthly needs and bill at a steady rate each month. This way they can count on spending X dollars a month and you can count on billing X dollars a month and everybody is happy.

Reasonable Expectations

When this relationship is forged, you can also be clear to your client about reasonable expectations. If they have an enormous new addition to the website, you may need to bill separately for that as it falls outside the scope of "maintenance". Medium-sized projects that exceed the standard hourly may be fine (that's the whole point of the plan), as long as it's not every single month.

At the end of some predetermined length of time, the bill can be evaluated by both sides and adjusted as appropriate.

Comments

  1. Jason A.
    Permalink to comment#

    This is a very interesting concept. I have some clients who do have monthly updates, others quarterly. I think my monthly folks would be very interested. Thanks for the great post!

  2. r_jake
    Permalink to comment#

    As a freelancer who works from home I think this is a good solution to the age old problem of small clients that can call on you any time of day (and sometimes night!) and ask for a ‘minor tweak’ to their site and then get surprised when you say you will have to charge them for it. this method means that everyone knows what to expect upfront, and it makes you appear experienced and professional.

    I guess the potential pitfall is where there isn’t any work needed on the site for a while (say six months) – the client may feel they are paying out for nothing. The analogy only works if there is going to be regular servicing required, and it can be sometimes difficult to predict this from the outset.

    Another situation that I would envisage is the client expecting preferential treatment because they have paid you upfront. I.e. you are in the middle of another large project, but they want you to drop everything and do their work because “that’s what they are paying you for”.

    I know both of these issues can be addressed by building good relationships with your clients, but the world isn’t a perfect place, right?

    • You can avoid the “paying for nothing” feeling with things that happen no matter what, even if there isn’t any “work needed”. Those are hosting, uptime monitoring, analytic reports, SEO tweaks, etc. Those are valuable services and are definitely a part of the monthly package.

    • Josh
      Permalink to comment#

      Don’t forget also that you can always offer them that as a “credit” for something like a major redesign. So let’s say you would charge $750 for a resigned look/feel and a wordpress version upgrade. So you could apply say 10 months of “unworked” maintenance fees toward that and the client could pay $450.

      I think there would be alot of creative ways to work it!

    • Permalink to comment#

      Good suggestions. Thanks!

  3. Yeah this is a nice idea seeing as how many clients don’t understand about maintenance fees – that they are only buying the design unless otherwise stated

  4. This is a great article and convenient way to discuss the billing. We do monthly maintenance for clients and I think the hardest thing we come across is the requests that fall outside of typical maintenance and should be billed seperately and then explaining why it fals outside of the scope to the client.

  5. Permalink to comment#

    That’s exactly how I do it, and that’s exactly where I got the inspiration for it! When I first moved in to my new home with my new wife, we were getting our power hooked up and that “Smart Pay” option was available for us. I thought it was brilliant, and then when I decided to start freelancing, I used that concept to bill my clients for monthly maintenance. Great tip!

  6. I think that more sites need monthly maintenance and we should bill clients as such – even if we are just using are are my sites up and monitoring analytics/seo.

    Good post!

  7. Permalink to comment#

    To this day it amazes me that I still work with clients and designers that do not follow up with clients, or provide additional subscription-based services.

    Many of the projects that I’ve worked on lately are for clients that had a website designed/built, and then the designer abandoned the site once everything was live. These designers are throwing away good money that they could be getting from additional maintenance and services, not to mention it leaves a much better impression with the client than ending the relationship on completion of the site.

  8. I realized a long time ago the maintenance contract has to be offered in the initial web consultation. Most clients ask how are they going to maintain the upkeep of their website. I explain to them that they could but they are not in the business to develop websites and maintain them. I usually work out a fee to maintain the site for a reoccurring fee that includes SEO updates, monitoring and in most cases, updating the WordPress software.

    The maintenance contract does not extend beyond the original site. Meaning, pictures, text or small page tweaks are ok. When it comes to adding extra pages or any structural changes, that is when it may fall outside of the general site maintenance. I usually give my client a reduced hourly rate to complete the work. I also tell them please give me up to 48 hours to complete the work because I may be involved in another project.

    I generally have had wonderful results using the maintenance contract instead of “pay-as-you-go”.

    • Permalink to comment#

      Thanks for adding this extra information Nina. This will help me when writing up a contract.

  9. Totally agree with this from a web site point of view but I always tell the electric company to get bent whenever they offer me a deal like this.

    There’s usually one spike large billing spike that kills the average (a cold January perhaps) and they spread that evenly where it would never happen again.
    I think it’s a good model as long as the client hasn’t already paid for that big spike or it’s not factored in.

  10. mattvot
    Permalink to comment#

    this is a GREAT idea!

  11. Permalink to comment#

    I can’t do this personally, as I’m hired by my employer through my one-man business. I charge by the hour, but I can work late/whenever as long as my boss agrees to it (usually always).

    But the analogy is nice though :)

  12. The problem I have is convincing small businesses to pay a monthly fee for this service. They love to complain when their site is outdated and gets hacked through a known security hole. So how do you convince them?

    • It’s not going to work 100% of the time, but the convincing happens through using this analogy usually.

      It’s beneficial to them, they know you are ready to go with changes whenever they need, there are no surprises… generally it sells itself.

  13. Like a house that contains people, a website with content should be maintained.

    Would website redesigns be included in the package?

    Billing is something I’m always trying to read up on, whether it be by hours, week, or a fixed price. I personally just use a fixed price right now, but I’m rather new to the whole client situation.

    A regular monthly bill sounds outstanding, because people know what to expect. While it keeps the client in the loop, you also know what you’ll be getting and you’re assured to be able to pay your bills (some of them at least!). I definitely like this idea and it’s something I should bring up with my client when the site is finished.

    Let’s say I get fifty bucks a month for maintaining site. My website hosting bill is ten bucks a month, an extra fifty puts forty bucks back in my pocket and my hosting bill is not something I need to be worried about. I suppose the great thing about it for me is that I could diminish a few smaller bills or just put it to the side and save it.

  14. Permalink to comment#

    GREAT article. I just ran into this problem doing a website for a friend. I didn’t mind helping him out with one or two tweaks here and there, but when he started wanting changes that became what I considered a bit excessive, I told him I needed to start charging. He’ll be giving me a single list of revisions I can do at once.

    A few friends also want me to work on stuff for them, obviously looking for a little help financially, how do you deal with clients that are also your friends? Do you help them out at all?

    • Permalink to comment#

      Unless you are doing web design/development for personal interest, I would avoid doing stuff for friends unless they are happy to be treated as a proper client, sign a contract and pay a standard amount for your work. Otherwise it’ll take up time that could be spent working on more profitable projects and the boundaries of what is reasonable for you to do is blurred. Can also be the end of said friendship!

      The exception to this is if you are just starting out and need projects to build up a portfolio of work.

    • Permalink to comment#

      This is where I’m running into a bit of a problem. I did need some portfolio work so I helped out a few friends, but now they all want a little help.

      I’ve finally put my foot down. Thanks for the advice, much appreciated!

  15. Permalink to comment#

    Almost all clients now request to be able to maintain their web site through some of the CMS, so especially with smaller clients, the ‘maintenance by designers’ will not be around for too long (at least not with this particular group of clients)

    • I think Chris did a great job elaborating on different areas where recurring income is a distinct possibility outside of standard maintenance.

      And I think you’d be surprised just how many clients prefer a real person maintaining their site who they can pay a reasonable amount opposed to staffing someone who can be trained on a CMS. I would agree with the overall point though, CMS’s are generally a great idea.

    • Permalink to comment#

      I believe a member of a client’s staff is a ‘real person’ too :-)
      Alright, I know what you are saying, but I just keep hearing “After the web site is live, I want to be able to update it myself” more and more. And lauder and lauder.

    • Permalink to comment#

      It’s funny, but it seems every time a client says they want a CMS and we build one, WE end up doing the updates! Most small to medium sized businesses do not have the in-house resources (i.e. time and man-hours) to properly maintain and update their sites – even adding new content is most often a challenge and falls to the low man on the totem pole within their own organizations.

  16. Aaron Heine
    Permalink to comment#

    Perfect article at the perfect time. I have been having trouble deciding about billing. Don’t want to run people off with too big a bill, but don’t want to sell myself short.

    What are some average monthly bills?

    Also seems like you run a risk of not getting enough payments. Could you do like and auto payment through Paypal or something?

  17. Permalink to comment#

    I think monthly billing is the best for company and for costumer.

  18. This is an interesting billing model for web maintenance.

    I believe that billing time and material for web edits is fair.

    However, it isn’t consistent income. An edit here and there at variable prices can often leave the studio scrambling to make ends meet, or rushing projects and late hours trying to meet expectations when multiple clients hit at once.


    Thanks & Regards
    Noel from nopun.com
    a professional graphic design studio

  19. Tracey
    Permalink to comment#

    Hi Chris, thank you for this article. It highlights the fact that we should try to maintain relationships with clients and continue to service them after go live (ie we are helping their business, not just designing a website). This will assist customers to identify the ROI in paying for our services as opposed to using an off-the-shelf template or going to a design contest site.

    I think data backup / restoration and ensuring the security of a site are valuable services we can offer too.

  20. Permalink to comment#

    I offer pre-paid ‘blocks’ of my time (at a reduced rate depending on how many hours are ‘bought’).

    This means the client can come to me for maintenance etc and I send a monthly account stating work done, time taken and time remaining. Once their pre-paid block is nearly completed I can send a reminder for the to top-up.

    It takes the niggles out of whether I should charge for that 5 minute alteration or not.

  21. Thank you for the very timely article. I am trying to come up with a product strategy for my new freelancing gig. Perfect timing!

  22. And, holy crap your new commenting system rocks!

  23. TeMc
    Permalink to comment#

    Very handy article !

    Thanks again Chris :)

  24. Permalink to comment#

    Not a bad idea. Easy payments for the client, constant income for the business.

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