Project Billing Overview
Service companies need to accurately track time spent on client projects and convert that time into invoices. Odoo connects Project, Timesheets, Sales, and Accounting into a seamless billing workflow. Whether you bill by the hour, by milestone, or on a fixed-price basis, Odoo supports the full cycle from time entry to cash collection.
Billing Models
Time and Materials
The most common model for consulting and professional services. Employees log hours against project tasks, and those hours are invoiced to the client at agreed rates. Odoo tracks billable versus non-billable hours, so you only invoice for productive work. Different employees can have different billing rates — a senior consultant might bill at $200/hour while a junior bills at $100/hour.
Fixed Price
The project has a total agreed price regardless of hours spent. Invoice on milestones (30% at kickoff, 40% at delivery, 30% at acceptance) or as a single invoice at project completion. Odoo tracks actual hours for profitability analysis — you see whether the fixed price covers your costs.
Milestone-Based
A hybrid approach where payment is tied to delivering specific milestones. Each milestone has a defined deliverable and a price. When a milestone is completed and accepted, the corresponding invoice is generated. Odoo supports milestone tracking on sales orders with invoicing triggered by milestone completion.
The Billing Flow
Step 1: Project and Task Setup
Create a project linked to a sales order. The sales order defines the billing terms — hourly rate, prepaid hours, or fixed price. Tasks within the project represent work items. Each task can be assigned to team members with deadlines and estimated hours.
Step 2: Time Logging
Team members log time against tasks using Odoo Timesheets. Time can be logged through the timesheet grid view (week or month), directly on the task form, the mobile app, or the timer widget for real-time tracking. Each entry records the employee, task, description of work performed, and duration.
Step 3: Timesheet Approval
Managers review and approve timesheets before they become billable. The approval step catches errors — incorrect task assignments, unreasonable hours, or missing descriptions. Only approved timesheets are included in invoices. Some companies also require client approval of logged hours before invoicing.
Step 4: Invoice Generation
For time and materials projects, generate invoices from the sales order. Odoo pulls approved timesheet entries since the last invoice and creates invoice lines with the employee rate, hours, and task description. For fixed-price projects, invoice milestones manually or through automated triggers when milestones are marked complete.
Step 5: Profitability Analysis
After invoicing, analyze project profitability. Odoo compares revenue (invoiced amounts) against costs (employee salaries proportioned by hours logged, plus any project expenses). The project profitability report shows margin by project, task, and employee, helping you price future projects accurately.
Billing Rate Configuration
| Rate Type | Configuration | Use Case |
|---|---|---|
| Employee rate | Per employee on sales order | Different rates per consultant |
| Project rate | Single rate on sales order | Blended rate projects |
| Task rate | Per task type | Different rates for design vs development |
| Prepaid hours | Hour pack on sales order | Retainer agreements |
Prepaid Hour Packs
For retainer clients, sell prepaid hour packs. The client purchases a block of hours (e.g., 40 hours at $150/hour = $6,000). As your team logs time, hours are deducted from the pack. Odoo tracks remaining hours and can send automatic alerts when the pack is running low, prompting the client to purchase additional hours.
Common Issues
- Unbilled hours accumulating — Set up regular invoicing schedules (weekly, bi-weekly, monthly) to prevent revenue leakage.
- Missing timesheet entries — Configure reminder emails for employees who have not logged time by end of week.
- Incorrect billing rates — Verify rates on the sales order before generating invoices. Rate errors multiply across many hours.
- Scope creep on fixed-price — Track actual hours against estimates to detect scope creep early and negotiate change orders.
DeployMonkey + Project Billing
Deploy Odoo on DeployMonkey and configure project billing workflows with AI assistance. From timesheet approval to profitability analysis, bill clients accurately and manage project finances from day one.