How Wholesale Pricing and Value Billing Can Help You Grow
I enjoy training accountants and bookkeepers in cities across the United States, Canada, Australia and even London, England, as a contract trainer for Intuit®. Along the way, I’ve discovered a few things. First, accounting professionals in different countries may have different terms for some things – inventory vs. stock, vendors vs. suppliers, for example – yet, we all face similar challenges working with and billing our clients. Second, I’ve noticed more and more accounting professionals, globally, are moving away from hourly billing to value billing. As a result, they are growing their practice and improving their profitability.
Problems with Hourly Billing
It seems hourly billing is as much a part of the accounting industry as debits and credits. However, more and more accounting professionals are moving away from hourly billing due to one primary problem: hourly billing essentially puts a wall between us and our clients. Consider a couple of key issues:
- Rather than turn to us, clients may ask their questions to strangers on the Intuit Community forum, LinkedIn groups or elsewhere, because they are worried about how much we will charge them. This isn’t right! We don’t want our clients reluctant or afraid to call us.
- Clients are concerned with keeping fees down, so they worry about what you are working on, why the work is taking so long and whether you are working fast enough. Plus, they are reluctant to ask for additional services, such as budgeting, cash flow and forecasting – areas in which we could really help.
- We aren’t selling our time. Whether it is monthly bookkeeping, payroll, taxes or something else, we are selling our knowledge, skills and experience to get the job done for the client. Every year, we have more experience and expertise – which, of course, is extremely valuable.
Improved Efficiencies and Value Billing
With value billing, you charge the client a fixed fee based on the value of the services provided. Accountants and bookkeepers can operate more efficiently using technology like QuickBooks® Online. For example, you can set up bank and credit card accounts to automatically download transactions every night. Combined with rules you can create, you can automate the majority of the data entry.
As a result, instead of spending 10 hours per month to get the work completed, it may now only take 2-3 hours per month. Plus, QuickBooks Online helps you save even more time and improve efficiency because you no longer waste time sending data files back and forth. You also won’t worry about version compatibility or face data integrity issues. Should you earn less money when you’re still providing the same end result for the client?
Due to improved efficiencies combined with the problems of hourly billing, many accounting professionals are implementing value billing for clients. They are creating packages and bundling additional services and/or benefits for clients. This allows us to differentiate ourselves and enhance the trusted advisor relationship with clients.
Consider some additional benefits you can bundle and include with your regular services:
- Training – as part of the initial conversion and setup, include time for training the client.
- Support – you can create different levels of support available for the client to choose which level meets their needs. You may offer email or phone support with a guaranteed response time. The quicker the response time, the higher the fee charged.
- QuickBooks Online – with wholesale pricing (see below), many accounting professionals are including QuickBooks Online with the services provided for clients. You don’t have to worry about clients not wanting to update their program, either!
- You can offer a la carte services for clients, including budgeting, cash flow forecasting and more, and incorporate them into customized bundles of services to meet the needs of your clients.
Wholesale Pricing for QuickBooks Online
Numerous accounting professionals asked Intuit for wholesale pricing on QuickBooks Online – and it is now available. Accountants and bookkeepers can sign up for wholesale billing to save 50% on QuickBooks Online for the life of the subscription. However, when needed, you can remove a client from your wholesale billing account and transfer the Master Admin for the subscription to the client, at the regular price.
Plus, Intuit recently lowered the price of QuickBooks Online (yes, you read that right – the price has been lowered) making it even more affordable – especially given the efficiencies realized from using QuickBooks Online. You can learn more about wholesale billing here.
If you want to grow your practice and improve your profitability this year, I encourage you to begin implementing value billing with your clients. To learn more, register to join me for an upcoming webinar for the QB PowerHour, or from webinars from Intuit Academy.