This example will show you how to create a T&M Project where the Client asked for a specific amount of hours worked on the project. While this sound similar to Fixed Price, in many cases each employee will have a different income rate, which means we will have to create Time & Materials project.
This is a hypothetical example!
John's company has acquired a project deal with Company B. Company agreed on 1 employee, who will be paid 100 €. Based on his contract, John will pay him ~50 € per hour. The project will last 3 months. The contract states that the whole project cannot exceed 480 hours of billable work.
- Let's create Time & Materials project lasting 3 months.
- Before we assign an employee, we will need to set our agreed time and budget. We will do that in the Estimation part of the Planning tab. Estimation is a tool that can help you predict the project's budget and time. By typing in each box of this section, the system will count the cost and income, and also present time and costs as charts and numbers in the Summary.
- Let's add 1 person to our project. In the Budget tab, we need to use the same hour cost as the one we agreed with our client.
- In the Summary, we will see the effects of our estimation and planning. It's very helpful during the planning phase of our project, it will help us keep track of actual work and if it's getting close to our agreed terms.
- Our employee has logged some hours.
- Let's move to the Report - Project progress, and look at our project.
- Here we will see the bar that will show us the progress of costs and incomes towards our estimated values. We will also find how much on track we're with costs and work time.
Now we will take a look at an example, in which we exceeded our agreed cap.
In this case, what we need to do, is to talk to the client, and ask him if is willing to pay for over-capped hours. If not, we need to go to the Budget - Dashboard and edit the Work for Income section, to match the hours that the client is willing to pay for.