You can charge more if you provide specialized services (like financial advice or forensic accounting). Emphasize your distinct abilities and credentials to support the higher price. I’m an entrepreneurial CPA that founded Xen Accounting, a100% cloud-based accounting firm, in 2013. Following its acquisition in 2018,I started Future Firm to help accountants fast-track the growth of a modern, scalable accounting firm of their own. As it’s quite difficult to hit the bull’s eye with the exact right price per month, creating pricing options (ie. a range of services for a range of prices) is exceptionally helpful here.
- Outsourcing accounting services allows you to reap the benefits of an accountant without the costs of a full-time employee, such as insurance and other benefits.
- Based on the average salary of a bookkeeper, you should be paying roughly $3,516 a month for bookkeeping if you choose to hire a bookkeeper.
- If a client takes advantage of multiple services, charge accordingly.
Based on the average salary of a bookkeeper, you should be paying roughly $3,516 a month for bookkeeping if you choose to hire a bookkeeper. Even if you plan to charge a fixed rate eventually, it can be a good idea to bill by the hour for the first few months. The client may require additional services from you in order to swaps and other derivatives set them up on a new system or clean up the mess left by the previous bookkeeper. I find cleanup projects always take longer than the client expects.
You have to use an hourly rate.
Just let the clock run and you know what your margin is going to be on each and every hour that you spend working. When deciding if you should do your bookkeeping yourself or hire outside help, the decision 55 virtual assistant jobs for beginners in 2021 is entirely up to you. For example, if you have the time to handle bookkeeping yourself, you might continue to do so to save money.
First, you’ll load up your engagement letter into Practice Ignition as a template under the “terms” section. My number one choice for easily creating proposals and engagement letters in seconds? Again, you are trying to figure out what you bookkeeping vs accounting: whats the difference think your small business client would pay. Your job is to determine what you think that person will pay. You will absolutely need a well-defined scope for this method to make sense. Otherwise you’ll bite into your margins if scope creep appears.
Automate common bookkeeping tasks and grow your client base
Then you also need to quantify the volume included within the services. This could mean determining how many bank accounts, credit card accounts, or number of transactions in a month. Your services agreement should include a list of which financial statements will be provided, and how often they will be delivered.
Bookkeeper salaries vary state by state (see our chart below), and depending on where you live, you could be paying a large difference in one place versus another. Bookkeepers have a wide variety of skills, so one of the factors you need to consider is what you need them for. If it’s basic client billing and documentation, a good solution may be accounting software that can assist you if you still want to play a more hands-on role.
Cost-Based Pricing
It takes a bit more strategy & thought than the billable hour as well as some basic education in price theory. In basic bookkeeping and accounting, not all hours are created equal. For the client accounting services in scope #1, you may get caught in a situation where you start the service at 100 transactions per month in the bookkeeping service. But then find yourself in a position handling a significantly higher per month amount of bank accounts and transactions down the road. Since your agreement doesn’t specify what is and what is not included in monthly bookkeeping services, it’s hard for you to increase your price without potentially souring the relationship.
Which tasks do you need help with?
For example, the process is similar to hiring an in-house bookkeeper but you don’t have to add overhead costs for employees on the payroll. So, don’t be afraid to boast about your experience while marketing your accounting firm. And, use it as a competitive advantage when it comes to pricing your offerings.