The results of the new Intuit Rate Survey are in!
The 2021 Intuit® Rate Survey results are in! If you were one of the almost 900 accounting and bookkeeping professionals who participated in the survey, you have our deepest gratitude!
We are excited to share the initial results with you. Over the next few weeks, we will be sharing the insights we learned in a series of articles that will be published on Firm of the Future. As in past years, the 2021 survey asked a variety of questions related to firm demographics, methods used to bill clients for different types of services, and of course, how much practitioners are charging for these services. This year we also asked specific questions regarding COVID-19 and its impact on your firm’s gross profit margins and average fixed prices, while also touching on how our clients were affected.
A series of questions pertaining to referral sources and social media marketing were also asked to gain insight into how firms are attracting new business. We were also interested to learn how practitioners were billing for advisory and technology consulting services. We’re excited to share our discoveries in future articles!
Who participated in the survey?
The following data tells us that most survey respondents:
- Were solo-practitioners (48%) or small firms with 2-5 employees (32%).
- Belonged to the QuickBooks ProAdvisor® program, with 51% belonging to the free QuickBooks Online program, and 48% (combined) belonging to one of the QuickBooks Desktop paid programs.
- Selected bookkeeper (65%) or accountant (40%) as one their professional designations.
This year, we included Business Advisor or Coach as a professional designation, and 25% of respondents identified themselves as such.
The survey asked practitioners how they billed their clients for various service offerings based on the following definitions:
- Hourly billing based on the hours worked.
- Value pricing based on the maximum amount a given client is willing to pay for a service, typically set before the work begins.
- Value billing is usually marking up—or more frequently marking down—the invoice to the client after the work has been performed.
- Fixed fees, with the fee often determined based on estimated hours (or cost) to complete the work.
When billing for QuickBooks-related services, hourly billing is still most commonly used for monthly accounting/bookkeeping (50%), catch-up accounting/bookkeeping (62%), clean-up or troubleshooting (66%), QuickBooks set-up (47%), and QuickBooks training (58%).
When it comes to billing for monthly services, our respondents preferred to use either hourly billing (50%) or fixed-fee billing (49%). Since our last survey in 2019, value pricing has declined by almost 10% indicating a shift toward other billing methods for ongoing monthly services.
Hourly billing methods are also predominantly used for technology consulting (40%) and advisory services (50%). However, fixed fee pricing was the most popular method to bill clients for payroll (43%) and tax preparation services (27%).
As observed in prior years, the survey results continue to suggest that accounting professionals prefer to bill hourly for services where there is a higher degree of uncertainty about the time and effort needed to complete the work.
Average hourly rates
It is important to note that only 48% of survey respondents were willing to provide their average hourly rate. Based on the data available, however, it appears as though we gave ourselves a raise since the last survey was done in 2019. The standard average hourly rates increased by 8.6% from $69 (2019) to $75 (2021).
Survey data also indicates that more practitioners in 2021 (35%) are charging the same hourly rate across the board for all services. This could suggest an effort to streamline billing rates or that services are being bundled.
We also looked at the average hourly billing rates for QuickBooks-related services by both professional designation and ProAdvisor certification status.
One interesting observation from the data is that certified bookkeepers are charging:
- 12% less for monthly accounting and bookkeeping services.
- 5% less for clean up or troubleshooting.
- 2% less for QuickBooks Training than bookkeepers without certifications.
The remaining data by professional designation displays a trend of higher fees charged for all services as practitioners progress from accountant (non-CPA) to Enrolled Agent (EA) to CPA.
The average hourly rates reported clearly show that the more you invest in ProAdvisor certification, the higher the fee you can command for services. The higher the ProAdvisor certification, the higher the average hourly billing rate reported.
In fact, the average hourly rate increase for four specific QuickBooks-related services showed an average increase of 34% upon achieving Core Certification, and another average increase of 13% upon achieving Advanced Certification status. The big takeaway here is to get your certifications! If you’ve haven’t signed up for the QuickBooks ProAdvisor program or gotten certified yet, you can start your journey to certification today.
As we approach the new year, it is a wonderful time to take stock of your practice. What did you do well? Where can you improve? What goals do you have for 2022? If you earned a new certification this year or began offering a service that brings added value to your clients. Consider raising your billing rates accordingly. You may also want to consider exploring other pricing options that can help to boost your profitability.
Overall, how do your rates compare to the survey data? Be sure to check out more upcoming articles about the survey that will include specific COVID-related data and how we serviced our clients during this unprecedented time. Also find out how your peers are marketing their services and what they plan to focus on in the upcoming year!