Does price or value matter most to your clients?

Kashflow logo
Paul Shrimpling
Remarkable Practice ltd
Share this content

Paul Shrimpling of Remarkable Practice explains why price is inextricably linked to value and why your competitors' prices shouldn't dictate what you charge.

Several conversations with a few accountancy firms in recent weeks have made me angry. I’m angry at the natural tendency to accept price sensitivity as a simple compare and contrast exercise with the other firms’ rates in the market. This suggests that other firm’s prices determine what price your firm can charge – what codswallop!

Yes, competitive pricing has an influence but there are four components determining the right price:

  1. Your clients’ perception of value
  2. Your clients’ willingness to pay
  3. How well you communicate your firm's offer
  4. Competitors p...

Please Login or Register to read the full article

The full article is available to registered members only. To read the rest of this article you’ll need to login or register. Registration is FREE and allows you to view all content, ask questions, comment and much more.


Please login or register to join the discussion.

18th Sep 2009 11:35

GREAT advice Paul

A fine balance with the recent "lowest price wins the work" pieces aparing elsewhere on the site.

It's horses for courses of course. Many of the accountants who chase clients who are price concsious are  trying to build up a new practice or fill some spare capacity as quickly as they can. They may accept that the clients won in this way will not last too long, will not contribute much to the practice and may not, in the end, be worth the time and effort they consume.

I much prefer and would endorse your suggested approach above. It's more relevent to those looking at building sustainable practices and those who are looking to take clients from other accountants who are not providing the service that the client really wants.


Thanks (0)
18th Sep 2009 12:50

Price or value?

Great article Paul. I guess I've got to the stage where I cease to be surprised by business owners - including a fair number of accountants - who still think that business can be gained and retained purely on price. The irony is that most of us will normally base our buying decisions for most goods or services on a range of factors - but we tend to forget that when selling our own goods or services. Although price is one reasonably important factor it is by no means the most important  for most buyers and certainly not the only factor. After all if you're the cheapest but provide a rubbish quality of service you're unlikely to keep the customer long; equally if you provide an excellent service but charge too little for it you'll probably have an unsustainable business model. How many business owners I wonder will go only to the cheapest restaurants available?

I guess the critical point here - coming out of both your work and Mark's comments - is that you can gain a client through lowering your prices far enough but it doesn't give you a sustainable relationship or a sustainable business! I have a good friend  who found this out the hard way - filling his time with work sold at below cost kept him extremely busy but with very little to show for it... 

For now though I'm off to find that fantastic but cheap restaurant - while it's still in business!



Thanks (0)
By ejkless
18th Sep 2009 13:27

Three cheers from a Yank

Well said. I am constantly amazed by the number of professionals who whine that they have become, "a commodity." This thinking is ridiculous.

When encountered with this conversation in a group setting, I simply ask, "How many of you insist on buying the cheapest toilet paper?" Never does a hand go up. The point is clear, if toilet paper is not a commodity, how can any professional think that their knowledge is one. 

Thanks (0)
18th Sep 2009 15:16

CRM and Value Pricing

Bang on as usual Paul, I see it in the Tax Investigation Insurance market all the time. The product offerings are now all much the same. The three dominant players ( in no particular order) CCH,Abbey and PFP all compete on price, my experience with my Accountant Clients is that it's not just price but 'people' deal with 'people'. As a variation on your coment re 'Pen pals',' look after your pen pals and turn them into mates'!

Look  forward to seeing you on the Conference circuit in the not to distant future.

Thanks (0)
18th Sep 2009 19:16

toilet paper tells a tale

I love your toilet paper analogy, thankyou. With your permission I'll use the metaphor next time I present on and around pricing.


Paul-- remarkable practice... inspires remarkable results

Thanks (0)