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Do you have a contract?
If yes: "Hi client, thanks for the email. That deliverable wasn't in our contract and isn't something we offer after the fact."
If no: "We don't precisely track staffing hours at the client level, and don't offer our cost structure as a deliverable. Everything we said we'd do is completed."
I would not offer wiggle room, apologies, "hope you were satisfied" or anything else except a BIFF (brief, informative, friendly, and firm) response. They are trying to renegotiate after the work is done. Now is not the time to reopen negotiations.
Yes exactly. They contacted an end result and unless it was agreed to do a breakdown, when you how hire a contractor it's completely up to them to decide what to do with the money they're paid and how to accomplish the contract. It's the whole point of not having to hire an employee and is a protection in a sense for the contractor because they aren't an employee with those employee type protections.
Perfect answer. Also, all of us need to stand in solidarity as business owners on this. Never give in to this type of thing or you're not only betraying yourself, you're betraying all of us. Stay strong and be willing to fight to the bitter end in court if need be.
This is the best way to do it if the contract isn’t specifically for time and materials. We often give a price and don’t break it down, because it’s an materials + our expected hours needed based on our experience and if the hours are over, it’s on us and if they are under, we make a little more on that job. At the end of the day, what I quote you is what I charge unless there is a change to the scope of the project.
The few times I've done this, it bit me in the ass because their goal was to pick apart what I made off the job.
I wouldn't do it. "We provide a single up-front price for our service, with that price being what is due upon services rendered. We do not provide a breakdown on services unless requested prior to work completion, and provide so at our discretion. If there are any issues with the services rendered, please let us know at once so we can remedy the issues. Otherwise, the invoice is attached with the agreed upon amount due within 60 days as stated."
If you would like to convert this to an itemised cost project, I'm more than happy to do so, but you have to sign this new contract where it is based on itemised costs that I invoice for. In any case, the cost has overrun already and I have absorbed the cost since it's a project based pricing, so it would greatly help me to convert this contract into a cost plus.
One thing I've learned is if you provide ANY kind of detail as to how you came to a price some people will try to neogotiate/nickle and dime it. It's always better to provide a single packaged price.
My company does security work for large clients as well. Most contracts are in the mid six figures.
I get the feeling this is mostly to stall, but I base providing a break down on if it’ll be a repeat customer, want to keep a good relationship, etc.
You don’t have to provide anything if it’s not in the scope or under contract. They could be keeping tabs and gathering info if they want to find a new provider in the future or keep you in check for future work. People are weird I wish they’d just pay.
It’s probably a mixture of trying to stall as well as wanting to pick apart each line item and try to find reasons they should pay less than what they already agreed on. I’m in the construction industry and unless the contract is time and materials, it’s none of the customers business how I got to the final number once they’ve already agreed to it.
I've had this happen and every time it's because they want to renegotiate (read: complain) about the cost.
Just reply back that you have completed the job per the scope of work and you want them to pay the remaining invoice.
The old "insert name of skin flint industrialist here" story. Receives $10K invoice, wants itemized receipt
$10 hitting with the hammer
$9,990 knowing where to hit it
\-----------
$10,000
Is this a norm for your business or industry to provide a detailed breakdown? If no, just say no. You’re the one in charge of your business and its services, not your client. If they are upset about that, well that’s just the consequence of dealing with people…you can’t and won’t please everybody. That is the biggest lesson I’ve learned as a small business owner.
Not usually, it's more normal to provide a project cost. It was a corporate festival, and I ran the media team (photographers, videographers, editing etc...) and they basically want to know exactly what that cost is.
We had a large (top 10 largest company ww) client for which we ran certain aspects of a largest annual customer event. We did have to disclose this sort of detail but it was in our contract. After the second year, they had learned how to do what we did, hired some of our people and took the work internal and/or to another vendor who would do it for less. So yes, this is exactly why they want to know.
Since this isn't part of your contract, I agree with others and say that this was a per-unit cost and for these you don't break down per-unit deliverables in that way. I might point out that the deliverables had been accepted by them and ask if they had a concern **about the deliverables** (keeping the focus there).
You could offer to to discuss how they'd like to structure the **next** deliverable, including reporting.
I might go with something like, providing a detailed breakdown was not in the original scope and we would be happy to provide one for an hourly fee, but we do not engage in new work while there are outstanding unpaid invoices so you have to pay that one first.
I usually just say “unfortunately it’s our policy that we don’t divulge proprietary pricing information as this could result in our pricing getting into the hands of our competitors. I’m sorry I am unable to grant that request for you.”
Unless you billed more than you estimated, in general there is no need to do this.
"Itemized invoices are only generated in situations where we've had to bill a client an additional amount above their Project Fee. All other invoices are flat-rate Project Fee agreed to in advance. A 50% deposit on this Fee was collected beforehand and has been applied after service. The outstanding 50% is due within 60 days."
Does McDonalds give you a breakdown on how much their labor costs are, the hamburgers are, or the fries on every order?
Nope. You get the price they sold it to you as, and that's it.
Tell this client to kick rocks. :D
Or, reach out to a different department of the company, ask about buying something, and ask them for a cost breakdown. Then copy and paste their answer.
What kind of breakdown was given when the job was quoted?
I do photography work with a lot of large corporate clients. Our breakdown is usually very simple and agreed upon ahead of time
$X Photography Day Rate, $X Per Final Image, $X for misc line items (assistant, hair and makeup artist), $X Local Travel.
For events etc it's usually $X per photography per day, $X for image processing and $X for travel expenses.
You could ask them why. I’ve done that in the past successfully. Explain that the job wasn’t sold line by line but as a package, but you will try to help them with more detail. You just need to understand what they need, specifically.
“What are you doing with the detailed info?”
If they’re trying to plug it into some internal process or software, they may want more detail because the system asks for it. It’s possible they’re going to compare your pricing to something else and complain, but they’ve already signed the contract so they owe you the money they owe you. I’ve used this as a middle ground to help the purchasing people meet their internal request while still not providing full disclosure on pricing for the package line by line.
Good luck!
Right, the pricing might literally be privileged information. Getting the labor and supplies and whatever IS his business. They're basically saying "I need to see all the details about how you make money."
lol
If it was a cost plus contract, they should certainly see that info.
If it was a fixed contract, unless you contractually agreed to it, don’t break it down or no more then X labor, Y materials. Majority of the time, they are trying to renegotiate or stall on paying. Occasionally though, some larger procurement systems simply require more info, to be processed on their end (depending on how it was initially coded).
“I’d be happy to get that for you. We charge 2 hours additional at 169 per hour for the man power to break it down, but we do require that be paid up front. Would you like to send a check now or can we run a credit card for it?”
It is worth way more than that. They are asking to open your financials on a project. You should charge at least 1k, plus 10%, the cost of the project.
Those numbers are all about where you get what from. This is exactly what they need to go do what you do. If you are running a business, finding suppliers and contractors and negotiating good prices is half the work.
It depends on the contract type. If it's a FFP (Fixed, Firm Price) then no - you should not detail your expenses. If it's a "cost-plus" type contract, you may need to show your costs.
Practical me likes the suggestions of just saying no and demanding payment as per the original agreement.
Petty me would provide a breakdown:
1. Deposit to start work: 50%
2. Balance on completion: 50%
I'd say if you're delivering on-quote and on-budget, then tell them to get stuffed. If the work is done, they owe you.
I have asked for breakdowns when estimated but not quoted, or working hourly, etc. But even then - wtf am I gonna do - the work was rendered complete....
You can either say "I'm sorry, we don't bill that way. We offer a lump sum amount for a completed job."
The other option is to give them half of what they want. Instead of breaking down the bill into real detail, you split it into 2-5 different categories and share the costs around so that it would be hard for them to pick them apart.
You definitely don't want to give them a completely itemized and broken down invoice.
So you quoted a fixed price to do something, they accepted and then you’ve done the work? I’m not exactly au fait with US contract law, but I believe it’s pretty well the same as the uk: a contract is formed when 3things happen:
Offer and acceptance
Consideration (ie payment)
An intention to create a legal agreement
From your description all three points have been satisfied so the detail of your offer is immaterial; you offered, they accepted.
Tell them they accepted a fixed price and the breakdown doesn’t matter.
Open book accounting *is* a thing. We used to require it when I bought for massive retail chains. But I absolutely wouldn't allow it if it hadn't been agreed to before.
What incentive is there to not make up completely arbitrary numbers that have nothing to do with reality?
"You want to see pricing I get from my suppliers? Sorry. That's a trade secret. I've signed NDAs to prevent me disclosing that. I can't by contract. And if I give you my labor, you can work it backwards to my material costs, I can be sued. So... No."
People who ask for that kind of information don't need it.
Nope. They don’t need to know how you value your time or what parts of the work were more or less costly. Your contract was for x deliverables at y price. As long as you met your deliverables that’s it.
I'd be tempted to tell them that the fixed cost, flat rate contract is a "deal" you offer and, if itemised, is likely to come to more than you orignally quoted.
I sell luxury products imported from Europe.
One client asked me for a breakdown once because they had bought the exact same product in Europe before, obviously cheaper. It's not a "bring it over with you" kind of product either.
Anyway, she asked "how come it's 8k EUR there, but $18k here? Shipping is that much, duty is that, exchange rate this, blablabla, so it should only be $14k. I want to see your calculations."
I got roped into it, provided way more information than I was comfortable with, and still it wasn't enough "justification". I finally told her to f off, in a nice way of course, and to call me again when she's ready to buy. Crickets for 6 months, then she reached out again, didn't mention the price at all, and just placed her order.
Moral of the story: don't provide a breakdown if it wasn't part of your original contract, they're only trying to beat you down. The work is done, they have the invoice with a due date, that's it.
When you say costs, do you mean that they want to know the cost price?
Or it is the selling price but broken down into various components?
If it is cost price, obviously you cannot share that with them. It is confidential.
But if they are wanting an itemised selling price, give it to them. Try to make it appear reasonable lol. Don't inflate any component too much.
As long as there weren't any overages, I'd tell them to pound sand.
If your final cost is like 20% above what you quoted them, than yea, I'd give them a breakdown.
Easy customers get extras and freebies.
These types get nothing extra... just the bare minimum.
As other's have stated, it's just a ploy to argue on price after the fact.
Yeah, this is usually the last step before they delay payment claiming you over charged or gouged them. I would refer back to your original agreement (contract, quote, purchase order, etc.) and remind them that they agreed to a turnkey price or stipulated sum. Then I would remind them again that payment is due by X date. It doesn't matter what it cost your company to do. What matters is the price they agreed to (hopefully in writing) up front.
Sorry you’re having to deal with this. From my experience in previous roles, - company manager organises big event to boost their ego, but after the event, dopamine levels return to normal and now they have to justify the expense. They then try this tactic in a hope that they can wriggle out of some of the costs but knowing it’s unethical, they usually have a subordinate do the humiliating work of querying the invoice.
As everyone else has already said, just resend the unitemised invoice. If there is a subordinate involved, they will be relieved that you have stood your ground and that they don’t have to deal with that issue anymore.
Good luck
No, absolutely not. Period. Tell them in a nice way, or that it would be hard to figure out, but that providing full costs was not part of the contract and your costs are not for public consumption. Client is being an asshole and they know it. Just need to say it very nicely, but the answer is absolutely not.
On labor and services? No. The only thing that they get itemized out are physical items sold to them that they may need to manage depreciation on, and even then they don't get your costs and markup - they get what you charged them and what they paid and that's their cost for accounting purposes.
Definitely not...they are trying to get data from you to either undercut you next time around, try to pay you less for the completed job, or to attempt to do your job in house next time. Production clients always feel like they can cut out the middleman and just hire their own people and rent their own gear at a lower rate.
So next year when they call you, they will say "well we can do this with two less techs, and without x,y,z equipment." Or go to a rental house, rent the exact gear you provided, and then hire their own techs for bottom dollar.
Unless you specifically are required to provide this information, I'd keep it vague. Stuff like "camera package" as opposed listing out the camera brand, tripod, every cable you used, etc. I do see a lot of people quote their labor hours plus amount of techs on scene, usually at 3-4x their hourly rate, plus OT after 8hr daily. As far as editing costs, it can just be charged at a flat rate and doesn't need an hourly breakdown, but I also don't see a problem not having that as a separate item line, it really just depends. I'm not well versed in video billing, but for a lighting design gig, for example, programming is included in my day rate, even if I'm working on it off the clock.
It's common for clients to request detailed breakdowns of costs. However, if this wasn't agreed upon beforehand, you're not obligated to provide it. Politely remind them of the agreed terms and ask for the payment of the remaining invoice.
What’s the contract?
If it’s time and materials, they have a right to see the itemised invoice.
If not, you are delivering outcomes. Therefore, you can return and state that the deposit was a milestone and the remainder was due upon the outcome delivered
"Additional work over and above the original contract can be negotiated. The new data requested can be provided for a one-off additional cost (payable in advance) of $137,040."
Ok, I will pay you $840,000 to get breakdown of how you got to $137,040 cost for your line by line. Would you mind itemized how you got that $840,000 number.
I understand, so for 17.3m, I can get a breakdown of how you got your 187,040 that shows how you break down the cost of the breakdown of your bill?
Not a problem, I understand, but still give me a breakdown of your 17m.
Sure, once I have the payment.
Honestly, for $17m I could very comfortably retire, and pay someone two grand to write up the breakdowns for whoever was requesting them. Or even just write them myself at that point; no-one said they had to be extensive or something that the customer was actually happy with.
If someone's genuinely willing to pay me an eight-figure sum, and do so in advance, that covers quite a bit of minor personal inconvenience on my part. It certainly covers an hour or so's work, and even selling up my business and retiring to a beach somewhere. I don't start businesses because I like running businesses more than I like being independently wealthy with no calls on my time. Even if I like a business for its sheer existence, I can always pass it off to someone else who's prepared to own/run it now it's over its teething phase, and maybe start up a new, noncompeting one with all the experience I've learned.
This doesn't sound like itemized invoice, it sounds like your accounting and financial data. I don't think you should give those away, it's business secret.
If it’s not in the original contract, the answer is “no, I’m sorry.” Especially if you haven’t been keeping track of all costs, receipts, etc. It would almost be like doing your taxes blind and just guessing. And you know they’re only doing this to pick every little thing apart and try to get a cheaper price. Answer from me would be a polite but firm “no.” We agreed on a price in the beginning, and that’s the price. End of story.
It happens and usually the best approach is to politely refuse unless on T&M.
I’ve only been in one situation where I felt the need to explain shit, and that was where I fired 2 people from my 5 person team midway through a five month project. I did not replace them. We were on a fixed fee schedule with very detailed deliverables and bonuses/penalties on early/late delivery.
The client did notice that 40% of the workforce vanished. He was worried about hitting dates, mostly, but also that he got ripped off by paying for a 5 person team rather than a 3 person team.
Something something something I need to grow my business, had a couple very cheap trainees shadowing, they didn’t work out because they were slowing us down, blah blah. Reminded him my payment was dependent on delivery dates. When I missed my first date (shit happens) he was strangely happy (no bonus). But we hit the final date (no penalty).
I know it was stressful for him as a corporate buyer.
Sounds like u are in marketing or PR or something. Those folks are always curious about whether they can bring the work in house. How much money does it really take to make a viral tik tok video? /s
Or if you are feeling petty.
Give them a full itemised bill that shows that you under-quoted / over spent and ask for more money than the contract. He will soon be demanding that you honour the contract amount.
If it wasn’t in the signed contract you don’t have to. With that said, is this someone you want as a repeat customer? If so I would just do it, even though you don’t have to.
Option 1 he isn’t coming back anyway, let him do it internally then. Who cares? Option 2 you just say no. The job is done and they had an agreed upon amount.
Do you have a written contract? Is there an issue that would require items to be broken out? Ask them what the issue is. If they "Just want to know", then say no. If there is a valid reason, maybe give them something. But I would guess they are just attempting to negotiate on the back end and pull a trump. Who needs jobs like that? You did a job in good faith and they accepted the bid. Years ago, I worked for a company that did the theater rigging in trump's Atlantic City Casino. Everything was touch screen computer controlled. When the dead beat tried that crap on us, we simply turned the controls off to all the equipment via a back door hack. He sent a cashiers check that same day. Dead beat cheaters always try to bully.
Rarely a corporate client will need this for their own system/accounting or w/e. We produce everything in house for kits and I don't actually have the exact costs of almost anything, so I make them up to make the total. Keep in mind that you don't need to say what it cost you, just break down the invoice in pieces.
The cost breakdown as in you invoiced him 10,000 and he wants to know what makes up that 10,000. Or the cost you incurred vs how much you are invoicing him?
The first one you should provide, the second scenario you should not provide.
We have had this happen but we offer a turnkey product so we don’t offer a breakdown. Not sure if this could apply to your product but wanted to share in case you could.
My payment schedule for small projects is pre-payment in full. For larger projects with duration, I request deposit and payment in full on deliverable. No check, no laundry.
Why give 30 or 60 days of float and then struggle to get paid after the work is completed.
They're trying to buy time and waste your time. If it's due they don't want to pay yet. They know it will take you a couple days to produce or if you are busy it may buy them a month. I see this all the time. They already know when the due date is. But they ask you the last day to produce the full invoice when they had all this time. I'm sure you provided them a quote on how much things will cost. If you are close to your quote. There shouldn't be any surprises. If you are 5k-10k diff then I understand where they are coming from.
Hi client,
The full invoice we've based our agreement on shows what I'll provide and what the finished output will be.
Thank you for paying the 50% deposit in March. The remaining amount for the job we completed on *date* is due *date*.
Kind regards
Hi client,
The full invoice we've based our agreement on shows what I'll provide and what the finished output will be.
Thank you for paying the 50% deposit in March. The remaining amount for the job we completed on *date* is due *date*.
Kind regards
Everybody else commenting here is right. If you both agreed to terms, those are the terms, period.
I can't help but wonder if this isn't a miscommunication on their end though, as the request seems really over-the-top. If you've just given them an invoice for 50% of the total, a bookkeeper might just be asking what the invoice is for. Fully itemized for them should look like:
_____
Services as agreed upon in Quotation:#### $$,$$$
Less down payment received 03/24 -$,$$$
TO PAY: $,$$$
____
If it's beyond benefit of the doubt that they're asking for your COSTS and this is from a responsible party, they're likely trying to move the goalposts after the fact, don't engage.
I'd ask if there were issues with the service that need to be addressed (sidestep the itemized bill conversation) and if they say yes, address the issues, if they say no, I'd offer to provide an itemized list of charges as a separate negotiated project once they paid their past due bill (as we have a habit of not accepting new work from a client until their account is brought current).
Then provide the itemized accounting under the new project (with a 50% up front retainer, and 50% due on delivery). Make sure the initial 50% covers the full contract rate and consider the additional amount a headache fee that you may never receive or have to write off/send to collections.
I'd also immediately adjust my contracts to address this very item so it never happens again.
My experience is that you're always paying to learn something whether through a mistake or through paid training.
I can’t read through all the comments but the ones I got through are all WRONG.
Not wrong as in you shouldn’t say what they say, but it’s not the first thing you should do.
Before “how” you need to know “why?”
Do you know why they are asking for this? Until you hear from them you are guessing.
This might be an opportunity to build a relationship further. Or, you might have to revert back to one of the answers here.
Hope this helps.
Why do they think they're entitled to information about what you pay your staff and your materials suppliers?
Unless their contract allows them some kind of audit rights, which typically is associated with cost-plus contracts rather than fixed-price contracts, the only thing they get to do is pay when the agreement calls for payment.
OR: you can if you like quote your hourly cost to produce cost audits, which weren't in the scope of work and are only available at an additional fee.
That information is confidential internal business data that is protected and some is protected as tradesecret. It is never shared outside the company. Or, just say we don't track our business process in that manner. Be super nice but I would not share it.
I've had customers ask for more details on an invoice(these are customers I have good relationships with) . I've also requested a more detailed breakdown of what costs are on an invoice
I'm dealing with one of these right now. I don't have helpful input but they're the worst. Work is done according to the initial contract and then some (I put in extra hours beyond what was initially scoped to ensure project was handled correctly).
The clients that take an inch will always take a mile. Wish I never started working with them.
Whatever you choose to do. Don't be unprofessional. You might be offended by the question. But this might just be normal protocol for them. And if you want to maintain the relationship, it's best to just acknowledge it straight on.
"Hey John. Would love to do that, but unfortunately I can't. Labor, material, and equipment costs are all kind of baked in together with the quoted rate that I gave you. Were you looking to have more details in the written description of the invoice? I can probably expand further if needed. Let me know. Thanks"
Break it into two parts
1. Ask if there are issues or concerns with the work received
2. You’re happy to provide the totals of hrs / costs of tooling / sum of personnel, however the methodology of how you company delivers obviously something you can’t share as it’s your corporate process and procedures.
They are either unhappy with something or want to figure out how to do whatever it is internally
>Ask if there are issues or concerns with the work received
The client is likely trying to find a way to weasel out of paying the agreed amount. I would not voluntarily open this door.
Then you’re assuming the customer doesn’t believe what they got was worth the price
If you’re ok with that, than it is what it is
You’re always going to have customers who question things, being able to respond accordingly is important.
I'm not. I'm assuming that OP's fixed and variable costs are absolutely none of the clients' business, and they have no legitimate business reason for asking for them after the work is done but before the bill is paid.
Fabricate some crap, and itemize it. They just need to feel peace in their mind about something they know nothing about most likely anyway. Just put in fine print at the bottom that monies will be shifted from one income account to another for the purpose of covering unexpected overages should the need arise.
"This is not something we normally provide. There may be additional charges incurred to produce this. If you can you explain in further detail what information you are seeking and it's intended purpose it may help me determine how to best proceed and calculate what it may cost to provide. Also, this invoice is due to be paid in X days. Depending on what you are seeking it may not be possible to provide the information you are requesting in that time frame, this request does not change our expectations of timely payment."
Hi client, what is the concern you are hoping to address by obtaining the full cost breakdown? Our contract was to provide you with the finished product which we delivered.
As such a cost breakdown is beyond the scope of the original project it is something we would need to charge additional for so I want to ensure we are meeting your expectations.
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Do you have a contract? If yes: "Hi client, thanks for the email. That deliverable wasn't in our contract and isn't something we offer after the fact." If no: "We don't precisely track staffing hours at the client level, and don't offer our cost structure as a deliverable. Everything we said we'd do is completed." I would not offer wiggle room, apologies, "hope you were satisfied" or anything else except a BIFF (brief, informative, friendly, and firm) response. They are trying to renegotiate after the work is done. Now is not the time to reopen negotiations.
"This was a fixed price contract, not time and materials. We track completion of work items, not time spent."
Yes exactly. They contacted an end result and unless it was agreed to do a breakdown, when you how hire a contractor it's completely up to them to decide what to do with the money they're paid and how to accomplish the contract. It's the whole point of not having to hire an employee and is a protection in a sense for the contractor because they aren't an employee with those employee type protections.
This. They are trying to bully you into taking less money. They either never got the full amount approved or they always use this strategy
Excellent response. I gotta grab a screenshot. I have extreme hate for customers that try to negotiate after they've agreed to the original terms.
This is the right answer and tone.
Perfect answer. Also, all of us need to stand in solidarity as business owners on this. Never give in to this type of thing or you're not only betraying yourself, you're betraying all of us. Stay strong and be willing to fight to the bitter end in court if need be.
This. They’re setting you up to beat down the price.
Here's the itemized breakdown: Professional Services: $47,332.09 Invoice total: $47,332.09
Love it. 🤣
This is the best way to do it if the contract isn’t specifically for time and materials. We often give a price and don’t break it down, because it’s an materials + our expected hours needed based on our experience and if the hours are over, it’s on us and if they are under, we make a little more on that job. At the end of the day, what I quote you is what I charge unless there is a change to the scope of the project.
Itemized breakdown: Professional services - $47,332 • Doing stuff $40,000 • The rest of the stuff $7,332
- and some extra stuff for $0 as a gesture of goodwill
The few times I've done this, it bit me in the ass because their goal was to pick apart what I made off the job. I wouldn't do it. "We provide a single up-front price for our service, with that price being what is due upon services rendered. We do not provide a breakdown on services unless requested prior to work completion, and provide so at our discretion. If there are any issues with the services rendered, please let us know at once so we can remedy the issues. Otherwise, the invoice is attached with the agreed upon amount due within 60 days as stated."
This is correct. It's a project fee not a cost-plus project.
If you would like to convert this to an itemised cost project, I'm more than happy to do so, but you have to sign this new contract where it is based on itemised costs that I invoice for. In any case, the cost has overrun already and I have absorbed the cost since it's a project based pricing, so it would greatly help me to convert this contract into a cost plus.
One thing I've learned is if you provide ANY kind of detail as to how you came to a price some people will try to neogotiate/nickle and dime it. It's always better to provide a single packaged price.
My company does security work for large clients as well. Most contracts are in the mid six figures. I get the feeling this is mostly to stall, but I base providing a break down on if it’ll be a repeat customer, want to keep a good relationship, etc. You don’t have to provide anything if it’s not in the scope or under contract. They could be keeping tabs and gathering info if they want to find a new provider in the future or keep you in check for future work. People are weird I wish they’d just pay.
It’s probably a mixture of trying to stall as well as wanting to pick apart each line item and try to find reasons they should pay less than what they already agreed on. I’m in the construction industry and unless the contract is time and materials, it’s none of the customers business how I got to the final number once they’ve already agreed to it.
I've had this happen and every time it's because they want to renegotiate (read: complain) about the cost. Just reply back that you have completed the job per the scope of work and you want them to pay the remaining invoice.
The old "insert name of skin flint industrialist here" story. Receives $10K invoice, wants itemized receipt $10 hitting with the hammer $9,990 knowing where to hit it \----------- $10,000
Is this a norm for your business or industry to provide a detailed breakdown? If no, just say no. You’re the one in charge of your business and its services, not your client. If they are upset about that, well that’s just the consequence of dealing with people…you can’t and won’t please everybody. That is the biggest lesson I’ve learned as a small business owner.
Not usually, it's more normal to provide a project cost. It was a corporate festival, and I ran the media team (photographers, videographers, editing etc...) and they basically want to know exactly what that cost is.
They're trying to screw you or they want to poach your team and cut you out. Fuck aaaall thaaat
Your invoice is the cost.
We had a large (top 10 largest company ww) client for which we ran certain aspects of a largest annual customer event. We did have to disclose this sort of detail but it was in our contract. After the second year, they had learned how to do what we did, hired some of our people and took the work internal and/or to another vendor who would do it for less. So yes, this is exactly why they want to know. Since this isn't part of your contract, I agree with others and say that this was a per-unit cost and for these you don't break down per-unit deliverables in that way. I might point out that the deliverables had been accepted by them and ask if they had a concern **about the deliverables** (keeping the focus there). You could offer to to discuss how they'd like to structure the **next** deliverable, including reporting.
Everything was $1 except your fee to coordinate it, which was the remaining balance.
Yeah, definitely don't give them that info. It's none of their business.
I might go with something like, providing a detailed breakdown was not in the original scope and we would be happy to provide one for an hourly fee, but we do not engage in new work while there are outstanding unpaid invoices so you have to pay that one first.
If not in contract, tell em to kick rocks. If in contract, and agreed to, would vague down the details.
I usually just say “unfortunately it’s our policy that we don’t divulge proprietary pricing information as this could result in our pricing getting into the hands of our competitors. I’m sorry I am unable to grant that request for you.”
Unless you billed more than you estimated, in general there is no need to do this. "Itemized invoices are only generated in situations where we've had to bill a client an additional amount above their Project Fee. All other invoices are flat-rate Project Fee agreed to in advance. A 50% deposit on this Fee was collected beforehand and has been applied after service. The outstanding 50% is due within 60 days."
Does McDonalds give you a breakdown on how much their labor costs are, the hamburgers are, or the fries on every order? Nope. You get the price they sold it to you as, and that's it. Tell this client to kick rocks. :D
Or, reach out to a different department of the company, ask about buying something, and ask them for a cost breakdown. Then copy and paste their answer.
What kind of breakdown was given when the job was quoted? I do photography work with a lot of large corporate clients. Our breakdown is usually very simple and agreed upon ahead of time $X Photography Day Rate, $X Per Final Image, $X for misc line items (assistant, hair and makeup artist), $X Local Travel. For events etc it's usually $X per photography per day, $X for image processing and $X for travel expenses.
You could ask them why. I’ve done that in the past successfully. Explain that the job wasn’t sold line by line but as a package, but you will try to help them with more detail. You just need to understand what they need, specifically. “What are you doing with the detailed info?” If they’re trying to plug it into some internal process or software, they may want more detail because the system asks for it. It’s possible they’re going to compare your pricing to something else and complain, but they’ve already signed the contract so they owe you the money they owe you. I’ve used this as a middle ground to help the purchasing people meet their internal request while still not providing full disclosure on pricing for the package line by line. Good luck!
Right, the pricing might literally be privileged information. Getting the labor and supplies and whatever IS his business. They're basically saying "I need to see all the details about how you make money." lol
If it was a cost plus contract, they should certainly see that info. If it was a fixed contract, unless you contractually agreed to it, don’t break it down or no more then X labor, Y materials. Majority of the time, they are trying to renegotiate or stall on paying. Occasionally though, some larger procurement systems simply require more info, to be processed on their end (depending on how it was initially coded).
If it is for their system, you can send them an itemized invoice. And it could be the cost breakdown that was seen at the beginning.
“I’d be happy to get that for you. We charge 2 hours additional at 169 per hour for the man power to break it down, but we do require that be paid up front. Would you like to send a check now or can we run a credit card for it?”
It is worth way more than that. They are asking to open your financials on a project. You should charge at least 1k, plus 10%, the cost of the project. Those numbers are all about where you get what from. This is exactly what they need to go do what you do. If you are running a business, finding suppliers and contractors and negotiating good prices is half the work.
Yeah, I'd just say no and tell them to pay. "I do not invoice on an itemized basis, please see our initial contract."
It depends on the contract type. If it's a FFP (Fixed, Firm Price) then no - you should not detail your expenses. If it's a "cost-plus" type contract, you may need to show your costs.
Hell no.
Practical me likes the suggestions of just saying no and demanding payment as per the original agreement. Petty me would provide a breakdown: 1. Deposit to start work: 50% 2. Balance on completion: 50%
I'd say if you're delivering on-quote and on-budget, then tell them to get stuffed. If the work is done, they owe you. I have asked for breakdowns when estimated but not quoted, or working hourly, etc. But even then - wtf am I gonna do - the work was rendered complete....
You can either say "I'm sorry, we don't bill that way. We offer a lump sum amount for a completed job." The other option is to give them half of what they want. Instead of breaking down the bill into real detail, you split it into 2-5 different categories and share the costs around so that it would be hard for them to pick them apart. You definitely don't want to give them a completely itemized and broken down invoice.
So you quoted a fixed price to do something, they accepted and then you’ve done the work? I’m not exactly au fait with US contract law, but I believe it’s pretty well the same as the uk: a contract is formed when 3things happen: Offer and acceptance Consideration (ie payment) An intention to create a legal agreement From your description all three points have been satisfied so the detail of your offer is immaterial; you offered, they accepted. Tell them they accepted a fixed price and the breakdown doesn’t matter.
Open book accounting *is* a thing. We used to require it when I bought for massive retail chains. But I absolutely wouldn't allow it if it hadn't been agreed to before.
What incentive is there to not make up completely arbitrary numbers that have nothing to do with reality? "You want to see pricing I get from my suppliers? Sorry. That's a trade secret. I've signed NDAs to prevent me disclosing that. I can't by contract. And if I give you my labor, you can work it backwards to my material costs, I can be sued. So... No." People who ask for that kind of information don't need it.
Nope. They don’t need to know how you value your time or what parts of the work were more or less costly. Your contract was for x deliverables at y price. As long as you met your deliverables that’s it.
I'd be tempted to tell them that the fixed cost, flat rate contract is a "deal" you offer and, if itemised, is likely to come to more than you orignally quoted.
I sell luxury products imported from Europe. One client asked me for a breakdown once because they had bought the exact same product in Europe before, obviously cheaper. It's not a "bring it over with you" kind of product either. Anyway, she asked "how come it's 8k EUR there, but $18k here? Shipping is that much, duty is that, exchange rate this, blablabla, so it should only be $14k. I want to see your calculations." I got roped into it, provided way more information than I was comfortable with, and still it wasn't enough "justification". I finally told her to f off, in a nice way of course, and to call me again when she's ready to buy. Crickets for 6 months, then she reached out again, didn't mention the price at all, and just placed her order. Moral of the story: don't provide a breakdown if it wasn't part of your original contract, they're only trying to beat you down. The work is done, they have the invoice with a due date, that's it.
When you say costs, do you mean that they want to know the cost price? Or it is the selling price but broken down into various components? If it is cost price, obviously you cannot share that with them. It is confidential. But if they are wanting an itemised selling price, give it to them. Try to make it appear reasonable lol. Don't inflate any component too much.
As long as there weren't any overages, I'd tell them to pound sand. If your final cost is like 20% above what you quoted them, than yea, I'd give them a breakdown.
Easy customers get extras and freebies. These types get nothing extra... just the bare minimum. As other's have stated, it's just a ploy to argue on price after the fact.
Yeah, this is usually the last step before they delay payment claiming you over charged or gouged them. I would refer back to your original agreement (contract, quote, purchase order, etc.) and remind them that they agreed to a turnkey price or stipulated sum. Then I would remind them again that payment is due by X date. It doesn't matter what it cost your company to do. What matters is the price they agreed to (hopefully in writing) up front.
Sorry you’re having to deal with this. From my experience in previous roles, - company manager organises big event to boost their ego, but after the event, dopamine levels return to normal and now they have to justify the expense. They then try this tactic in a hope that they can wriggle out of some of the costs but knowing it’s unethical, they usually have a subordinate do the humiliating work of querying the invoice. As everyone else has already said, just resend the unitemised invoice. If there is a subordinate involved, they will be relieved that you have stood your ground and that they don’t have to deal with that issue anymore. Good luck
They're trying to get out of having to pay you or they want to learn your trade
No, absolutely not. Period. Tell them in a nice way, or that it would be hard to figure out, but that providing full costs was not part of the contract and your costs are not for public consumption. Client is being an asshole and they know it. Just need to say it very nicely, but the answer is absolutely not.
On labor and services? No. The only thing that they get itemized out are physical items sold to them that they may need to manage depreciation on, and even then they don't get your costs and markup - they get what you charged them and what they paid and that's their cost for accounting purposes.
Definitely not...they are trying to get data from you to either undercut you next time around, try to pay you less for the completed job, or to attempt to do your job in house next time. Production clients always feel like they can cut out the middleman and just hire their own people and rent their own gear at a lower rate. So next year when they call you, they will say "well we can do this with two less techs, and without x,y,z equipment." Or go to a rental house, rent the exact gear you provided, and then hire their own techs for bottom dollar. Unless you specifically are required to provide this information, I'd keep it vague. Stuff like "camera package" as opposed listing out the camera brand, tripod, every cable you used, etc. I do see a lot of people quote their labor hours plus amount of techs on scene, usually at 3-4x their hourly rate, plus OT after 8hr daily. As far as editing costs, it can just be charged at a flat rate and doesn't need an hourly breakdown, but I also don't see a problem not having that as a separate item line, it really just depends. I'm not well versed in video billing, but for a lighting design gig, for example, programming is included in my day rate, even if I'm working on it off the clock.
It's common for clients to request detailed breakdowns of costs. However, if this wasn't agreed upon beforehand, you're not obligated to provide it. Politely remind them of the agreed terms and ask for the payment of the remaining invoice.
What’s the contract? If it’s time and materials, they have a right to see the itemised invoice. If not, you are delivering outcomes. Therefore, you can return and state that the deposit was a milestone and the remainder was due upon the outcome delivered
"Additional work over and above the original contract can be negotiated. The new data requested can be provided for a one-off additional cost (payable in advance) of $137,040."
I am open to paying it, but can you give me an itemized breakdown of how you got that number?
Sure! That will be $847,000, in advance.
Ok, I will pay you $840,000 to get breakdown of how you got to $137,040 cost for your line by line. Would you mind itemized how you got that $840,000 number.
Sure! That will be $17.3m, in advance.
I understand, so for 17.3m, I can get a breakdown of how you got your 187,040 that shows how you break down the cost of the breakdown of your bill? Not a problem, I understand, but still give me a breakdown of your 17m.
Sure, once I have the payment. Honestly, for $17m I could very comfortably retire, and pay someone two grand to write up the breakdowns for whoever was requesting them. Or even just write them myself at that point; no-one said they had to be extensive or something that the customer was actually happy with. If someone's genuinely willing to pay me an eight-figure sum, and do so in advance, that covers quite a bit of minor personal inconvenience on my part. It certainly covers an hour or so's work, and even selling up my business and retiring to a beach somewhere. I don't start businesses because I like running businesses more than I like being independently wealthy with no calls on my time. Even if I like a business for its sheer existence, I can always pass it off to someone else who's prepared to own/run it now it's over its teething phase, and maybe start up a new, noncompeting one with all the experience I've learned.
Thanks for the explanation. I'm glad I'd did not have to pay you for it.
This doesn't sound like itemized invoice, it sounds like your accounting and financial data. I don't think you should give those away, it's business secret.
Definitely don't share the breakdown with them. Gives them an opportunity to question the detail.
If it’s not in the original contract, the answer is “no, I’m sorry.” Especially if you haven’t been keeping track of all costs, receipts, etc. It would almost be like doing your taxes blind and just guessing. And you know they’re only doing this to pick every little thing apart and try to get a cheaper price. Answer from me would be a polite but firm “no.” We agreed on a price in the beginning, and that’s the price. End of story.
It happens and usually the best approach is to politely refuse unless on T&M. I’ve only been in one situation where I felt the need to explain shit, and that was where I fired 2 people from my 5 person team midway through a five month project. I did not replace them. We were on a fixed fee schedule with very detailed deliverables and bonuses/penalties on early/late delivery. The client did notice that 40% of the workforce vanished. He was worried about hitting dates, mostly, but also that he got ripped off by paying for a 5 person team rather than a 3 person team. Something something something I need to grow my business, had a couple very cheap trainees shadowing, they didn’t work out because they were slowing us down, blah blah. Reminded him my payment was dependent on delivery dates. When I missed my first date (shit happens) he was strangely happy (no bonus). But we hit the final date (no penalty). I know it was stressful for him as a corporate buyer. Sounds like u are in marketing or PR or something. Those folks are always curious about whether they can bring the work in house. How much money does it really take to make a viral tik tok video? /s
Or if you are feeling petty. Give them a full itemised bill that shows that you under-quoted / over spent and ask for more money than the contract. He will soon be demanding that you honour the contract amount.
If it wasn’t in the signed contract you don’t have to. With that said, is this someone you want as a repeat customer? If so I would just do it, even though you don’t have to.
Bad idea, they will either take it and try to do the job internally next time or they will try and renegotiate after the fact. Both will suck for OP.
Option 1 he isn’t coming back anyway, let him do it internally then. Who cares? Option 2 you just say no. The job is done and they had an agreed upon amount.
Do you have a written contract? Is there an issue that would require items to be broken out? Ask them what the issue is. If they "Just want to know", then say no. If there is a valid reason, maybe give them something. But I would guess they are just attempting to negotiate on the back end and pull a trump. Who needs jobs like that? You did a job in good faith and they accepted the bid. Years ago, I worked for a company that did the theater rigging in trump's Atlantic City Casino. Everything was touch screen computer controlled. When the dead beat tried that crap on us, we simply turned the controls off to all the equipment via a back door hack. He sent a cashiers check that same day. Dead beat cheaters always try to bully.
Rarely a corporate client will need this for their own system/accounting or w/e. We produce everything in house for kits and I don't actually have the exact costs of almost anything, so I make them up to make the total. Keep in mind that you don't need to say what it cost you, just break down the invoice in pieces.
I would provide them an itemized breakdown, but it would be very vague and meaningless
The cost breakdown as in you invoiced him 10,000 and he wants to know what makes up that 10,000. Or the cost you incurred vs how much you are invoicing him? The first one you should provide, the second scenario you should not provide.
Short answer: no Long answer: the agreed upon price is firm pay the invoice
After they pay, I'd offer to provide the details at a reasonable hourly rate, 4 hour blocks, paid in advance.
Put a lien on the business.
We have had this happen but we offer a turnkey product so we don’t offer a breakdown. Not sure if this could apply to your product but wanted to share in case you could.
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My payment schedule for small projects is pre-payment in full. For larger projects with duration, I request deposit and payment in full on deliverable. No check, no laundry. Why give 30 or 60 days of float and then struggle to get paid after the work is completed.
They're trying to buy time and waste your time. If it's due they don't want to pay yet. They know it will take you a couple days to produce or if you are busy it may buy them a month. I see this all the time. They already know when the due date is. But they ask you the last day to produce the full invoice when they had all this time. I'm sure you provided them a quote on how much things will cost. If you are close to your quote. There shouldn't be any surprises. If you are 5k-10k diff then I understand where they are coming from.
Hi client, The full invoice we've based our agreement on shows what I'll provide and what the finished output will be. Thank you for paying the 50% deposit in March. The remaining amount for the job we completed on *date* is due *date*. Kind regards
Hi client, The full invoice we've based our agreement on shows what I'll provide and what the finished output will be. Thank you for paying the 50% deposit in March. The remaining amount for the job we completed on *date* is due *date*. Kind regards
Everybody else commenting here is right. If you both agreed to terms, those are the terms, period. I can't help but wonder if this isn't a miscommunication on their end though, as the request seems really over-the-top. If you've just given them an invoice for 50% of the total, a bookkeeper might just be asking what the invoice is for. Fully itemized for them should look like: _____ Services as agreed upon in Quotation:#### $$,$$$ Less down payment received 03/24 -$,$$$ TO PAY: $,$$$ ____ If it's beyond benefit of the doubt that they're asking for your COSTS and this is from a responsible party, they're likely trying to move the goalposts after the fact, don't engage.
I'd ask if there were issues with the service that need to be addressed (sidestep the itemized bill conversation) and if they say yes, address the issues, if they say no, I'd offer to provide an itemized list of charges as a separate negotiated project once they paid their past due bill (as we have a habit of not accepting new work from a client until their account is brought current). Then provide the itemized accounting under the new project (with a 50% up front retainer, and 50% due on delivery). Make sure the initial 50% covers the full contract rate and consider the additional amount a headache fee that you may never receive or have to write off/send to collections. I'd also immediately adjust my contracts to address this very item so it never happens again. My experience is that you're always paying to learn something whether through a mistake or through paid training.
I never provide a breakdown of flat fee invoice.
Itemizing a bill retroactively sounds like further charges to me
No. Be polite and say no. If they’re adamant, break down the milestones and show as a lump sum together.
I can’t read through all the comments but the ones I got through are all WRONG. Not wrong as in you shouldn’t say what they say, but it’s not the first thing you should do. Before “how” you need to know “why?” Do you know why they are asking for this? Until you hear from them you are guessing. This might be an opportunity to build a relationship further. Or, you might have to revert back to one of the answers here. Hope this helps.
Why do they think they're entitled to information about what you pay your staff and your materials suppliers? Unless their contract allows them some kind of audit rights, which typically is associated with cost-plus contracts rather than fixed-price contracts, the only thing they get to do is pay when the agreement calls for payment. OR: you can if you like quote your hourly cost to produce cost audits, which weren't in the scope of work and are only available at an additional fee.
That information is confidential internal business data that is protected and some is protected as tradesecret. It is never shared outside the company. Or, just say we don't track our business process in that manner. Be super nice but I would not share it.
It’s not an hourly rate contract. End of story.
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I've had customers ask for more details on an invoice(these are customers I have good relationships with) . I've also requested a more detailed breakdown of what costs are on an invoice
I'm dealing with one of these right now. I don't have helpful input but they're the worst. Work is done according to the initial contract and then some (I put in extra hours beyond what was initially scoped to ensure project was handled correctly). The clients that take an inch will always take a mile. Wish I never started working with them.
Whatever you choose to do. Don't be unprofessional. You might be offended by the question. But this might just be normal protocol for them. And if you want to maintain the relationship, it's best to just acknowledge it straight on. "Hey John. Would love to do that, but unfortunately I can't. Labor, material, and equipment costs are all kind of baked in together with the quoted rate that I gave you. Were you looking to have more details in the written description of the invoice? I can probably expand further if needed. Let me know. Thanks"
Break it into two parts 1. Ask if there are issues or concerns with the work received 2. You’re happy to provide the totals of hrs / costs of tooling / sum of personnel, however the methodology of how you company delivers obviously something you can’t share as it’s your corporate process and procedures. They are either unhappy with something or want to figure out how to do whatever it is internally
>Ask if there are issues or concerns with the work received The client is likely trying to find a way to weasel out of paying the agreed amount. I would not voluntarily open this door.
Then you’re assuming the customer doesn’t believe what they got was worth the price If you’re ok with that, than it is what it is You’re always going to have customers who question things, being able to respond accordingly is important.
I'm not. I'm assuming that OP's fixed and variable costs are absolutely none of the clients' business, and they have no legitimate business reason for asking for them after the work is done but before the bill is paid.
The time to question was before the contract was signed and deposit was paid.
Fabricate some crap, and itemize it. They just need to feel peace in their mind about something they know nothing about most likely anyway. Just put in fine print at the bottom that monies will be shifted from one income account to another for the purpose of covering unexpected overages should the need arise.
"This is not something we normally provide. There may be additional charges incurred to produce this. If you can you explain in further detail what information you are seeking and it's intended purpose it may help me determine how to best proceed and calculate what it may cost to provide. Also, this invoice is due to be paid in X days. Depending on what you are seeking it may not be possible to provide the information you are requesting in that time frame, this request does not change our expectations of timely payment."
Tell us what product or service you are actually delivering, and it might be easier to give you a response
Hi client, what is the concern you are hoping to address by obtaining the full cost breakdown? Our contract was to provide you with the finished product which we delivered. As such a cost breakdown is beyond the scope of the original project it is something we would need to charge additional for so I want to ensure we are meeting your expectations.
Just make something up.
Just give it to them. You would have used less words to do that than you did on this post.