Bookkeeping services pricing guide: How to nail your pricing Karbon resources

GrowthForce accounting services provided through an alliance with SK CPA, PLLC. There are major differences between the three types of bookkeepers and what each can offer your business. Figure out which works for your business closing entries and start tackling the problems, or potential problems, with your books. They focus on recording the financial transactions of a business through maintaining records, tracking transactions, and creating financial reports.

Step 2: Explore the Different Ways of Pricing for Services

A full-time bookkeeper handles the day-to-day accounting functions for your office. Keeping your books in order and up-to-date is the foundation of the financial strength of your business. Hiring a full-time bookkeeper in this billing period date on subscription invoices situation could be the right answer for you. In addition, you’ll need to add around 20% on top of salary for benefits and overhead including office space. After you decide your pricing, be ready to sell your services.

Firm of the Future

1. Strategically shifting from an hourly rate to packages and value pricing bought added $100k+ to her bottom line.
2. Add these up and divide by the number of hours you plan to work each month.
3. Some bookkeepers add in profit margin as a buffer for the unexpected.
4. It’s important to clearly outline the scope of the project and any additional charges that may apply if the project scope changes.

If the answer is yes, then size shouldn’t be your deciding factor. As you’ve seen, there are several solutions to this bookkeeping dilemma, but they also come with additional questions you should keep in mind before making a decision. To help you on this decision-making journey, we’ve gathered four questions to ask yourself before hiring a bookkeeper. A big tip, if you’re going to any type of non-hourly billing, is to work out a price list for your services. This can be something you share or even display on your website, but it doesn’t have to be.

Monthly Bookkeeping  Fees

For clients with more than $1 million in revenue, it would be good to look at how much they would pay a full-time bookkeeper, sitting in their office, working 40 hours a week. Strategically shifting from an hourly rate to packages and value pricing bought added $100k+ to her bottom line. With the additional cash flow, she hired a bookkeeping assistant. By doing so, she now focuses her time primarily on business development and advisory services. The average hourly rate for freelance bookkeepers ranges from $26.91 to $43.57. Depending on your geographic location, this amount will be more or less than the average national rate of $34.67 per hour.

This method is not based on how fast or how slow you work. No matter your speed, you will still be earning the same amount of money. Are you caught in a never-ending cycle of putting out fires in your firm? Constantly reacting to demands and other people’s agenda is exhausting. It’s a symptom that you’re accounting firm is running you instead of you running your firm. As you can imagine, her business was running her instead of her running her business.

And bookkeeping is a great medium in helping you make the smartest business decisions. You can read more on pricing strategies in our guide to starting a business. It goes without saying then, that pricing will have a big bearing on your revenue and profitability. Think about what you and your client need out of a pricing structure. You’ll see variations of that range across the internet, with Indeed.com reporting a range of $15 to $30 per hour.

If you can structure a deal that keeps clients onboard for a few months, they’ll really begin to see the ROI. Like so many jobs, experience influences hourly rates for bookkeepers. New bookkeepers will enter at a lower rate than those with years of experience under their belt.

It’s important to note that the software you use may affect your rate, as some solutions are more expensive than others. Another important factor is your expertise in various accounting software. In general, good cloud-based software makes accounting easier and reduces the hours, allowing you to charge more per hour. So here, we’ll cover how the cost of bookkeeping services varies depending on several factors and all the options available depending on the needs of your business.

You end up with clients who respect and value your services. Your bank account grows while lightening your workload. And, you run your business instead of having your business run you. As a result, what you charge for your bookkeeping services reflect your expertise rather than the tasks. You client list fills with high value clients who are not price-sensitive or question your fees. Whether you charge by the hour or offer a fixed fee, both are considered competitive pricing.

This is the most common way to charge for your bookkeeping services, especially when you first start out. If your business is moving into a growth stage, you need to consider graduating to full accrual based accounting, with financial and management reports that help you scale. Typically you will need this level of financial management not only for yourself but for your key stake holders including banks, investors and advisors. Looking at average accounting fees is a great starting point, but there’s more that goes into setting your pricing than national averages. You also need to consider factors that directly impact your accounting services cost.

Therefore, their higher rate frequently translates into better financial guidance, faster issue-solving, and a more strategic approach to up-to-date bookkeeping. In the past, it cash vs accrual vs hybrid accounting was popular for bookkeepers to charge per transaction. To be honest, I’ve never done it that way, so I’m not as familiar with what the rates would be for this type of pricing.

Stay attuned to market trends and industry developments to ensure your rates remain competitive and aligned with the value you provide to your clients. Another mistake is failing to consider the value of your time. Many firm owners underestimate how long it will take them to complete a project, which can lead to pricing that doesn’t adequately reflect the time and effort involved. If you’re unsure how long a project will take, it’s better to err on the side of caution and quote a higher price than you initially think is necessary. In many cases, customers are willing to pay more for items they believe are valuable. Value pricing can help businesses generate higher profits.

The number of transactions you’ll be handling also influences your pricing. More transactions typically mean more work, which can result in higher rates. Ensure that your pricing structure accounts for transaction volume. Though they may seem relatively minor, 2-3% fees will quickly eat into your profits. When setting your prices, ensure you are charging enough to cover these fees.

This will be the monthly rate you can present to your client. I often mention that, starting out as a bookkeeper, you can charge $40 per hour to your clients. Then, as you gain experience and niche down, you can charge up to $80 or sometimes more per hour.