Seven ways to increase your fee income
Mark Lee outlines how to get paid for additional work over and above the standard client fee.
Time-based billing used to be very common among accountants and some still do this. However, most clients want some idea of how much the fee is going to be before they engage you.
Many new practicing accountants set fixed fees and later find that they have underestimated the time that it takes to service their clients. They then use the Any Answers facility here on AccountingWEB.co.uk to seek advice on how they can increase their fees.
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I'm a big fan of value pricing too Bob
For those who have yet to embrace value pricing though I think it's worth sharing practical solutions to the all too common situation whereby additional time and work needs to be billed or written off.
If it's happening too often then I agree it's worth thinking more deeply about value pricing. But it's not a solution to specific cases as are my suggestions above.
Mark
Symptom of a bigger problem
Fixed pricing is a half way house so you have made recommendations which fall inside Value Pricing methodology like ensuring your fixed fee relates to specific work and talking to clients.
However, suggesting timesheets help with pricing and management really cuts across what Value Pricing stands for. Time recording and using time for billing is really the problem…fee disputes are just the symptom.
Always an interesting topic.
Good article Mark, I can certainly relate to all of that, running a small expanding practice. Thank you.
I use timesheets , even on fixed fee work, to keep things real, and review the good and not so good productivity and profitability of each particular job. If the clients records need additional work, I explain this either during the course of preparing the work, or at the end, depending on my relationship with the client.
I charge as and when additional work is carried out beyond the scope of the normal work, but not for emails or phone calls unless I feel it is discussed at the time of contact.
Clients don't want surprises so timely invoicing, as mentioned Mark, i agree is essential, even interim invoicing where the client is dragging his heels and the WIP is stagnant on a job for a month or two.
I confess I have not looked at value pricing, but will be looking into this, thank you Bob.
Value Pricing
Some useful tips but trying to fix fixed pricing problem really isn't the answer..value pricing is. This is a which a completely different mentality to charging clients and managing work which is truly ethical and ultimately in the best interest of the client, practice owner and employees.
Pricing is a massively important topic for the profession - Ron Baker (author and founder of Verasage) help a Webinar...anyone who would like a CD copy can register here.
Bob
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