I'm making a proposal for a project where I will need to buy supplies or incur other expenses like shipping samples to the customer or mileage to meet. The expenses will increase if the customer chooses to try a wide range of options. Outside of Upwork, these expenses would normally be billed to the customer at my actual cost as a straight reimbursement and I would provide supporting documentation (receipts or invoices). Is there a way to bill expenses separately from labor/services on Upwork?
The main issue is the service charge. It doesn't feel right to add a service charge to an expense. Most corporations and governments prohibit or strictly limit the fees that can be added to expenses. For new customers it would be a 25% adder (inverting the 20% service charge) until I've billed $500, then it would fall to 11% (inverting the 10% service charge).
The second issue is customer perception of the cost; If I'm billing them $300 but $100 of that is for expenses, I'm getting $140 for my work, but they feel like they are paying me $300 for my work. When I itemize the expenses they have a clear understanding of what they are paying for my work and what they are paying for the expenses I've incurred on their behalf or at their direction.
Upwork is not intended to be used as a traditional expense invoicing system.
Mainly because freelancers will be charged 20% of any expense reimbursements. Up until the point where you have $500 in earnings. Then you only pay 10%.
You already know this.
There is no alternative when it comes to being paid directly by the client.
But there ARE alternatives.
For example, you can send a list of items that you need to the client, and then the client can purchase them but instead of having them shipped to his house, the client can specify YOUR address as the shipping address.
Another alternative is to build your material expenses into your service fee.
For example, if you are going to do Task X, which entails $500 of labor and will cost $200 in supplies, then you can have the client set up the milestone payment for Task X for about $750 - to adequately cover your labor AND pay for the expenses AND cover Upwork's fee on the money you add to cover expenses.
re: "How do you bill a specific job or task in Upwork?"
Basically: You don't do that.
I don't do that.
re: "Do you create a 'new contract'?"
Freelancers can't create a contract. Clients create a contact.
Freelancers can't create invoices.
Freelancers can't bill for a job or task.
I have completed 270 jobs on Upwork. Here is what I do:
a) A client creates an hourly contract. I log time. I get paid automatically.
b) A client creates a fixed-price contract to pay me for doing a specific task. I do the task and submit it. I get paid automatically (or the client manually releases payment).