Yep, that time of year and my thoughts start to turn to 2011 fees. Quite often a thread appears on AWEB concerning fee levels for a specific job and (a) It attracts lots of opinion and (b) gets lots of hits. So, I wonder if any of you would like to do something a bit more formal? I have been posting on AWEB without Pseudonym for about 7 or 8 years now so most of you will be aware that I have no marketing or commercial interest in you (or your clients!).
My thoughts were that I would guage interest and you could email that to me by hitting my name/avatar above. You can be entirely anonymous as far as I am concerned (apart from your on-line persona). If there is some interest, I would then benchmark some key client groupings (6 -10), distribute them to those interested and request typical fees charged. I would then collate the replies in to an anonymous matrix for all those who submitted data. You could then cut the data however is of interest or benefit to you.
I appreciate that there is a huge cross section of people who use AWEB and therefore I would like to limit the data set to:
Non franchised sole-practitioners
Not based in a major city
Engaged in general practice
AWEB - I suspect this should be in discussion groups or something but I wanted people to be aware of it before you move it!
Thanks Steve
Replies (66)
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possible reason for differences
There are two (contradicting) possibilities:
1) I am very good at tax, and self confident that I can do an excellent job so will charge a higher price because I feel I provide value for money, as an expert. On the other hand, I am not more than average at business planning/management, so I value my work less. Therefore I may be very expensive for tax work and very cheap for management accs.
2) Because I am good at tax and enjoy it, I'd be prepared to do it for cheaper. On the other hand, I hate writing business plans so if the client wants me to do it, I'd have to charge a lot to motivate me.
These are just examples
good points AI Walters
I like others was quite surprised at how my fees compared - not as bad as I thought and better in some cases.
For me it is down to confidence - if i know the subject, I know I can add value and therefore find it easier to price. If it is something new to me, I know I need to do some research but then also question what value I may be adding and seem to be less comfortable in quoting a higher price.....
So I know I need to keep reading up, continue to build my technical skills so that I am better placed to quote premium fees.
Thanks Steve, for pulling this together as I have find it very useful
Thank you
I also wish to say thank you Steve for the idea and your time in sorting out the questions and the responses.
It makes interesting reading for me too.
Dave
What does the survey show?
Great work Steve - thank you.
I am a little shocked about low fee levels. Mine were highest. This explains why my appointments rate is high but the sign up rate could be a lot better.
I am just thinking what does this say about our profession in the practice world? To me it shows that acountants work very hard for financial rewards that does reflect this and we as accountants are not very good at running a business? I understand some are not in this just for the money. My view is I run a business and I want to make good money.
I just wonder whether the point about QBE/QBF comes into fee levels? Even taking account of location factor I think the fees are low.
Perhaps my fees are too high and I have got it totally wrong? I need to refect on this as well.
NB My comments are not intended to demean anyone but intended for this area to be explored.
No right or wrong
"Even taking account of location factor I think the fees are low.
Perhaps my fees are too high and I have got it totally wrong? I need to refect on this as well."
There's no right or wrong answer. There's so many factors to take into account. I work from home so my expenses are limited. I built a business up from scratch and I've always been busy but my prices were low. I've charged more in the last year or two and I don't get any resistance from old or new clients. Some accountants may charge twice as much as me but they expect more clients will leave as they are not happy with the prices.
I spend about £2,500 on accounting practice software and I have a good understanding of the accounts and tax software. This enables me to spend relatively little time on preparing accounts and tax returns. Presently I use spreadsheets for all the tasks related to my clients and services. I review everything each month and list what needs to be/can be done in the next month and then have one list for the month. I also use spreadsheets for time & fees and invoicing. I'll review what can be improved easily by transferring the information into Digita Practice Management.
I prefer to charge a small amount but train the client to produce information in the format I prefer. If it's difficult for the client to produce the information I'm happy to accept it in their format but I'll charge more.
Peter
Thanks Peter. The thought that comes to my mind is you are both experienced and efficinet. As a result it takes you less time compared to someone like me. Does this mean you should chrage less? People, as you know, are buying your knowledge and experience not just how much time you spend on their affairs. There is a premium for this?
On the software front again it was the right decision you made, that makes you more efficient. Does this mean your fees should lower?
They can be
It means my fees can be lower.
Say I charge £500 for a set of accounts and can do it in a few hours, I could presumably get £2,000 from a few clients for similar work until they realise that plenty of accountants would charge less. Maybe £800 - £1,200 would be more possible but there could still be resistance. I've charged £2,500 for a set of accounts, quarterly VAT returns, monthly payroll and two personal tax returns including one buy to let. This client is a good client but they like to understand their accounts so I charge for fully explaining any queries they have. The £500 would be for somebody who doesn't need the explanations.
If I have a personal task to do I do it. If I worked as many hours as I could on chargeable time I could earn a lot more but I am happy with things as they are. Being 58, I don't expect to change anything dramatically in the future.
If you want to change what you do then do it but I don't think you can think about it and come out with what is right or wrong - just what you feel comfotable with.
Where do your clients come from ....
If you want to change what you do then do it but I don't think you can think about it and come out with what is right or wrong - just what you feel comfotable with.
Posted by petersaxton on Wed, 16/02/2011 - 00:13
Another factor is often where you got the client from. When someone moves to you from another practice the first thing you do I guarantee, is take a look at the last accounts and see how much the previous accountant was charging. And I guarantee you set your fee accordingly.
I've seen clients I'd happily do for £3k, but, having seen they were paying their last accountant £7k I'd be a fool not to charge them at least £5k. On the other hand I've seen clients paying their previous accountant fees that I wouldnt bother getting out of bed for.
Just come across this thread
Hi Steve
Do you have any plans to extend this. I would have liked to have been involved and would have been very interested in the results.
Next Time
Hi SteveDo you have any plans to extend this. I would have liked to have been involved and would have been very interested in the results.
Me too.
Benckmarking
Hi Steve
I dont think I ever got the results of this, is it possible to get a copy.
Hi
I know this is old but was wondering if I could have a copy of the results please!
Thanks