The strangest secret behind pricing confidence
How you feel about yourself affects virtually every aspect of your life, and when it comes to how much you should charge for your services, this is a critical element.
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I had that exact thing happen today.
A chap turned up. My old accountant hasn't completed my Companies HCompliance statement and my company has been dissolved. My bank accounts been frozen. I cannot use my credit card machine. Help! Its all falling apart.
So I said get the old accountant to fix it for free, its his fault ( it was)
No he refused. I want you to fix it....
So its a few forms to fill in and if he had googled administrative restoration he could have had it done for £130+ disbursements.
So heres a chap who is desperate, his business is about to be ruined...
What do you charge?
a. £2000 because I am the expert and its his fault and lets take advantage and theres a 50/50 chance of getting it
b. £1000 I reckon I can squeeze that out of him
c. £150 it will take us a bit longer than the online firms, but you shouldn't rip people off in trouble you should help them
So.... what are you going to do?
What about the AML compliance costs; preparing engagement letters; agent registration with HMRC; obtaining transfer info from the old accountant (which will be difficult)?
New clients blaming someone else are, more often than not, complicit in the alleged failures, and will blame you when they mess up again, so I factor in the initial take-on costs when pricing, which I might not do if I perceived a better, longer-term relationship.
On your fee suggestions, b, obviously:
a. There would be no chance of not getting paid, as the new client would pay up front or go elsewhere. Any other arrangement in this scenario would be madness.
b. If it is worth that to the client, then charge that, and get paid first.
c. As noted above, you missed out an awful lot of your time in your calculation.
Ill get his company accounts etc personal annual tax return and payroll... probably for the next 5 or 6 years though :)
Spot on Kevin. I have found that one of the key benefits that accountants get from joining The Inner Circle is increased self confidence and thus increased ability to quote and secure higher fees for the work they do.
Kevin writes the article but Mark looks to land the business.
That could be a topic for another article! ;)