The formula to calculate the effective billing rate is:
\[ \text{EBR} = \frac{\text{TBH} \times \text{HR}}{\text{THW}} \]
Where:
An effective billing rate is a measure used to determine the actual rate at which a professional or service provider is billing their time. It takes into account the total billable hours, the hourly rate, and the total hours worked. This metric is crucial for businesses and freelancers to understand their true earning efficiency and to ensure that they are maximizing their revenue potential. By calculating the effective billing rate, professionals can make informed decisions about pricing, time management, and resource allocation.
Let's assume the following values:
Using the formula:
\[ \text{EBR} = \frac{120 \times 50}{160} = \frac{6000}{160} = 37.50 \text{ per hour} \]
The Effective Billing Rate is $37.50 per hour.
Let's assume the following values:
Using the formula:
\[ \text{EBR} = \frac{100 \times 60}{150} = \frac{6000}{150} = 40.00 \text{ per hour} \]
The Effective Billing Rate is $40.00 per hour.