I've been using a simple structure: $1500 retainer plus 25% contingency on verified savings. But I'm seeing other auditors with complex fee schedules - different rates for different types of savings, sliding scales based on total amounts, separate charges for report preparation, etc. Ameren Missouri territory. Anyone have experience with more complex structures? Do they actually increase your total compensation or just confuse clients?
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Simple retainer vs complex fee structures - what works?
Elmer, I tried a complex fee structure for about six months - different rates for demand vs energy savings, higher percentages for tariff corrections vs billing errors, etc. Total disaster. Clients got confused, I spent more time explaining fees than doing audits, and my collection rate actually went down. Went back to simple: $2000 retainer, 25% contingency on everything. Much better results. Duke Energy territory.
Cecilia's experience matches mine. Keep it simple. CPS Energy territory has lots of complex rate structures, but that doesn't mean my fee structure needs to be complex too. I use $1000 retainer plus 20% contingency, period. Clients understand it immediately, no confusion about what they owe, and I can focus on finding savings instead of calculating different fee categories.