Key takeaways
- Price the scope, not an hourly estimate of an undefined relationship.
- Include the review, the meetings and the cleanup in the cost.
- Offer two or three tiers so the client can choose the level of service.
- Review the price every year and after any scope change.
Define the scope
List the services: monthly bookkeeping, the close, the report, payroll support, sales tax, AP/AR, the advisory meeting and the year-end package. A scope that says "bookkeeping" is not a scope.
Name what is not included: cleanup, a new entity, a loan application, an audit, a tax return or a special project. The exclusions are as important as the inclusions.
Model the cost
Estimate the hours for the first three months, not the first week. The first month includes onboarding and the opening balances; the second and third show the recurring work.
Include the review time, the client meetings, the email questions and the cleanup of the prior books. Those hours are real, and they are the ones most often left out of the price.
Multiply the hours by the firm's fully loaded cost, not only the bookkeeper's hourly rate. The cost includes software, review, admin and the owner's time.
Anchor to the client's value
A monthly close that lets the owner see the numbers before a loan application is worth more than a set of reconciliations. The price should reflect the decision the client can make with the report.
Compare the price to the client's other costs: the accounting software, the payroll provider, the rent. A $1,000 monthly fee is a different decision for a $2 million business than for a $200,000 business.
Build two or three tiers
A tiered proposal lets the client choose the level of service instead of deciding whether to buy at all. A base tier covers the close and the report; a higher tier adds the advisory meeting, the cash forecast or the payroll support.
Make the recommended tier obvious. A proposal with three equal options is a proposal the client postpones.
Write the proposal
The proposal should name the services, the deliverables, the monthly fee, the start date, the client's responsibilities and the assumptions. A proposal that does not name the assumptions is a scope dispute waiting to happen.
Include the records the client must send and the due date. The price assumes the client sends the bank statements and the payroll register on time; say so.
Review the price
Review the engagement after three months: the actual hours, the client's response time, the questions and the cleanup still open. Adjust the scope or the price before the first year is over.
Review the price every year and after a new entity, a new service or a large increase in transaction volume. A price that is never reviewed becomes a discount the firm did not choose.