Total lack of understanding
Just in case you haven't noticed, over the years I've had some discussions with various members about Value Pricing (VP).
The members who disagree with me seem to think VP is about ripping clients off. They prefer a "time/cost plus notional profit" approach to pricing, sometimes using timesheets sometime not.
I come at this from the position that time/cost pricing is selfish/self-centred and effectively makes the profession unethical. Continuing with time/cost pricing will make the accounting profession irrelevant. The conclusion is that accountants will just do is more accounts/tax returns as they gradually become more efficient forced by prices falling.
Many existing practitioners may get out before they experience too much pain, but what about the future?
When you understand VP you appreciate it is the only approach to pricing that:
- Puts the client first
- Fully aligns the accountant and client
- Encourage and rewards innovation
- Drives down costs on low value work
- Maximises value for everyone (clients, practice owners, employees and society)
Pricing is fundamental to strategy so it seems sensible to me to understand as much as possible about such an important topic. At the end of the day being an accountant in practice requires much more that technical knowledge of accounts/tax. But, there is another reason to fully understand VP.
Business owners expect/need this extra knowledge (especially now) and an accountant who does not understand VP and just prices with cost/plus will probably only be able to talk to their client about things like job costing.
Over the years I have invested time and energy to build my knowledge of VP through:
- Reading books
- Attending seminars and Webinars
- Accountants (and other professional) who have adopted VP
- Using VP
I'm interested to know where you have gained your understanding. What have you actually done to build your knowledge of VP?
- Viewing folder contens en masse 330 8
- Entrepreneur - want to submit accounts by myself 1,115 15
- HMRC Funding for Employee PAYE refund 172 3
- What would you do here, potential insolvency. 320 5
- Sage Line 50 Data conversion 109 2
- Separate companies same Director buy from each other 622 14
- Tax relief on Enterprise Investment Scheme subscriptions 135 2
- Calculation of 10 year anniversary charge 174 1
- pension contribution annual allowance charge 90 1
- Dominant influence and intercompany loans 250 6
- CIS 125 1
- Really?! 733 9
- Bookkeeping question for Finance Lease payments 197 3
- Company Car for Owner Director number crunching - is there a ready reckoner? 452 6
- How did you recalculate your payroll fees 896 12
- Is the CT61 return dead? 295 4
- Car Purchase 155 1
- Directors liability insurance and scope 181 7
- IR35 152 1
- Car benefit or not? 1,961 18
- Self employed and HMRC Worldwide Subsistence Rates 704
- 2015 tax year end 437
- Interest paid - do new rules affect Tax Credits? 415
- Self employed consultant working in Ireland 354
- Costly Accounting Software contract 308
- Market Invoice (P2P invoice discounting) tax treatment 254
- Directors' advances and credits 251
- DTA tie-breaker issue 238
- Tax on internet ad sharing income 221
- Credit against UK NI for NI paid to EEC Countries 201