How to Price Your Bookkeeping Services in a Way That Feels Good to YouNov 22, 2021
This week, we’re getting into a topic that comes up ALL the time and is a big topic of conversation -- pricing. Consider this my gift to you because this could easily be a paid workshop not just a post, but I’m excited to share some of this knowledge with you. We’re going to talk about the questions that I commonly see.
But before we dive right in, welcome to the Profits + Prosecco Podcast! I’m your host, Katie Ferro, CPA, reformed rule follower, creator of Booked Out Bookkeeper, mom to 3 little ones, and Kajabi enthusiast.
This podcast is for entrepreneurs who desire to change their life through their profitable business, and for bookkeepers and accountants who want to escape the 9-5 and start a simple scalable bookkeeping business like I did.
Bookkeeping increases profits and profits change lives. So pop some bubbles and let me show you how!
I want to give you a huge reminder that you can’t mess up pricing too badly. It’s something you can reevaluate and make updates as you go. Just because you set up a pricing system does not mean you have to stick to it forever.
Being “Too Expensive” or “Too Cheap”
It’s important to remember that there is a range of prices for each industry and bookkeeping is no different. When people talk about their prices there will always be someone that says, “that’s too high!” and someone that says, “that’s too low!” Both are valid points!
Pricing is based on more than one factor. You have to think about location, what your clients do and how complicated their clients’ bookkeeping is, or how much experience they have. You have to charge what is best for you and your business.
Fixed vs. Hourly
I highly recommend using a fixed monthly rate for your services. Not only is it easier for you to manage, it’s easier for the client as well. The type of client that hires out a bookkeeper is probably pretty busy. The whole reason they’re outsourcing bookkeeping is because they’re making enough money and have transactions to track and they don’t want to do it. You can bet they also don’t want to worry about going in and paying you every month too.
So that’s where autobilling comes in. I personally and professionally love autobilling because it’s a simple thing that saves time and cuts back on your administrative duties. So the next reason why I love fixed monthly billing is that you don't have to track your time and worry about overcharging or undercharging your client.
I know that you're an ethical person and you would not want to feel like that. But the other side of that is that you might be billing the client for time that you didn't actually work, and neither one of the scenarios would feel good for you. So when you agree to a fixed monthly amount, you stop that from ever becoming a concern.
Finding Your Pricing Sweet Spot
I want you to remember that just because you’re not billing hourly, that you don’t aim for a certain amount of hours. For me, what I shot for was on the bookkeeping side to make around $100 an hour. Not everything that you do in your business is billable.
I don't charge for sales calls. I don't charge for when I'm creating content. I don't charge for my email list or engaging in Facebook groups or doing podcasts or doing trainings for the most part or anything that would get me out there. There's a lot of things that you don't charge for along the way.
In my head, when I'm going to be working on books, I want to be making about $100 per hour. Let's say, it's $80 to $125 per hour. That is how you're going to mentally base your price, and that doesn't have to be your hourly. For me, I felt like I work really efficiently, and I know I'm very confident in the fact that I'm really good at taking a mess and turning it into something that's neat and organized. And I will help them figure out a system that works and is efficient, and I am confident in my ability to do that.
I would hate to charge by transactions. I wouldn't want to quantify their transactions. I want to just go in and accept rules, tie out to the bank statements and that's about it. I don't want to have to micromanage my own time, and I certainly don't want my clients to feel like I'm giving them some sort of a growth penalty.
When it comes to how to price your client, you want to ask a ton of questions up front on the sales call. You need to verify what they're saying by asking to see things like their current set of books, if they have it, bank statements and things like that. This will help you be prepared to price them fairly.
How to Price Your Bookkeeping Services in a Way That Feels Good to You: The Bottomline
What I want you to know is that if you're feeling any type of overwhelm about pricing, you can't actually mess this up long-term. You should get started and underquote or overquote, whichever way it's going to end up, just let the cards fall how they will and learn from it.
More often than not, you’re actually going to underquote your clients because you will underestimate your time commitment and the value of your services. And it doesn't really matter if this happens, because you're going to gain a ton of clarity from doing it. You're going to at least get paid something versus nothing if you don't start, right?
The most important lesson you can learn from this whole thing is simply this: You have to feel comfortable with your price. Let me say that again, You have to feel comfortable with your price.
I know that you found value in this, and I urge you to share this post with anyone you know who could benefit from it. And my big call to action for you is to just get started, quote what you're comfortable with, be OK with it being whatever it is, stop comparing it to anybody else and just go ahead and start signing clients at a price that you can get behind today!
I hope you enjoyed this post! If you're looking for more insight on how to become a bookkeeper, enroll in Become A Bookkeeper (BABs). Or, if you’re confident in your skills as a bookkeeper and want to learn how to grow and scale your bookkeeping business, you can apply for Booked Out Bookkeeper (BOB).
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