In Productive, cost rates help you assign a value to the time spent on tasks or projects, reflecting the cost of an employee's or contractor's work. After configuring default cost rates for your team, you can enhance financial tracking by defining custom cost rates specific to individual budgets or deals.
Custom cost rates allow for varying cost rates for different individuals within a specific budget or a deal, offering flexibility in monitoring overall costs.
This is particularly useful for managing multiple projects with unique payment terms or when working with contractors who have different rates for different projects or clients.
Adding custom cost rates is optional. If not added to a budget, Productive will use only the default cost rates.
Custom cost rates are available on the Ultimate plan.
Adding Custom Cost Rates
To add a custom cost rate, navigate to your budget or deal, open the sidebar, click on the budget settings ⚙️ icon, and then add a custom cost rate for the selected individual.
Here you can add all the people you want to have custom cost rates and define the rate and the currency.
Tracking Costs On A Budget
Once you've saved the changes, navigate to the Time tab in your budget to view the updated cost calculations.
A quick reminder; make sure to include the Cost field in the table if it's not already there!
The recently added cost rate will now be applied to all time entries tracked by the individual within this specific budget.
Note: If a person has the "Adds organization overhead to cost rate" checkbox enabled in their default cost rate, that overhead cost will be added to the custom cost rate as well.
Deleting Custom Cost Rates
Deleting a custom cost rate will result in reverting to your default hourly cost rate, and the costs of all time entries within this budget will be recalculated.
Use Case: Managing Multiple Projects
Scenario
Picture an employee juggling several projects at once, each with its own payment terms. On top of that, your agency may secure a special project requiring a unique skill not covered by standard cost rates.
Solution
Custom cost rates let you set specific cost rates for each person working on a budget within a project or a deal.
Use Case: Tailoring Rates for Contractors
Scenario
When working with contractors, their costs may change based on the project or client. For example, a contractor might bill at 10$/h on some projects, but on some others, their work might cost 15$/h.
Solution
Custom cost rates offer more flexibility, letting you apply different rates for the same person based on the project they're working on.
This is handy when contractors charge differently based on the project or client.