Cliff Crown has been featured in PR Week, 14 November 2008, for his letter on managing PR fees:
Dear Editor,
Your article ‘Recession: cash flow pain worsens’ (31 October 08) is a critical read for small-to-medium-sized PR agencies. I am advising my clients that what they can measure, they can manage, and that staff performance and fee-to-service level ratios are two of the most important insights into the financial stability of the business.
With any fee-based business, it is absolutely essential that fees are set at the right level to cover expenses and create a reasonable profit, to cover the overheads, so that new business can drop immediately to the bottom line. Also, for agencies where special or one-off projects make the super profits, it is essential to bear in mind that ad-hoc projects are likely to be fewer moving forward.
Agencies must consider their expenses model and ask whether or not this requires a fee adjustment to account for the rising cost of petrol, public transport, and other day to day expenses. This is most likely to affect businesses that charge a flat fee or fee percentage, rather than charging the cost incurred or a percentage mark-up on that amount.
When it comes to measuring staff performance, time sheets are a simple and effective way of assessing the fee-to-service level ratio and identifying the weaker members of staff. While managers have a feel for who is busy and who is not, empirical evidence of this is extremely useful, and can be used to increase fees where you can show the value of the work undertaken.
For further information please contact Cliff Crown, Head of Vantis' Media Group, or complete and submit the online form below.