How do we charge clients? Please explain from your experiences.
MoneySavingBank
Registered Posts: 143 Dedicated contributor 🦉
As Monsoon said in another thread
""Ltd Co accounts and CT600 for a moderately straight forward Ltd Co with a good TB, £5-600 ish.
Add directors payroll and P35 filing, add personal tax return, add annual return.""
I really strugle to give a quote to my client. Sometimes it is good. Sometimes its too bad that client got to run away....
All I am trying to say is I am not having a good experience with this.
I know some (names like Ian, Monsoon, steve...) of you are really experienced on this. Would you mind to give us idea on how to breakdown this into each small unit and create a good quote where it is attractive to cleints and attractive to us as well.
I hope the new accountants and bookkeeper will learn a lot about quote. (Defenitely I will )
Many thanks for reading this.
Cheers,
MSB
""Ltd Co accounts and CT600 for a moderately straight forward Ltd Co with a good TB, £5-600 ish.
Add directors payroll and P35 filing, add personal tax return, add annual return.""
I really strugle to give a quote to my client. Sometimes it is good. Sometimes its too bad that client got to run away....
All I am trying to say is I am not having a good experience with this.
I know some (names like Ian, Monsoon, steve...) of you are really experienced on this. Would you mind to give us idea on how to breakdown this into each small unit and create a good quote where it is attractive to cleints and attractive to us as well.
I hope the new accountants and bookkeeper will learn a lot about quote. (Defenitely I will )
Many thanks for reading this.
Cheers,
MSB
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Comments
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Hi, we tend to charge our clients on an hourlly rate, you could start by giving them a quote of £30 p/hr but join our scheme and pay only £24 I haven't been turned down yet !, tell them there is a 3 month trial as to exactlly how much time your spending on their book keeping, I tend to quote 1 hr a week to start with, you will then know at the end of the 3rd month a more accurate time you will be working for them and can therefore increase or decrease the DD that has been set up.
Good luck and I hope this helps !0 -
I gained my experience of pricing whilst working in practice. There I had various charge out rates and I monitored my performance against what was charged to the client and the cost last year (i.e. other employees charge out rate x hrs taken).
I then took this method into my business. I offered fixed fees and then monitored my time to see if I was recovering at my desired charge out rates.
I ditched this though in place of value pricing. I think about the client, their circumstances, the likelihood of questions as well as the complexity and frequency. As well as this I consider the work required.
You need to compare what others are quoting who are in competition with you. As well as what they quote think about what's included and then learn to sell yourself and the way you offer your services. It isn't necessarily what you charge but the services you offer for that fee.Regards,
Burg0 -
We use fixed fees based loosely on hourly rates, plus a 'going rate' type approach.
For a set of accounts plus associated tax return, whether that's sole trader, partnership or Ltd Co, it's a case of estimating the time needed to do the work, the amount of meetings and advice the client will need, multiplying that by our hourly rate, and quoting a fixed fee. Don't forget to include administrative time in this as well, as that may take at least 30mins per year. As we have various members of staff, we have different charge out rates depending on the type of work and therefore who is doing it.
A standalone self-assessment is £125, which is about in the middle of market rate, it covers accountant's time to complete, admin time to set up and MLR the client, and client meetings.
Do not be tempted to be the cheapest. The type of client who pick the cheapest price are not necessarily the type of clients you want. We try and pitch ourselves in the middle (if we were cars, we wouldn't be a 15 year old Skoda, nor a brand new Aston Martin, but a 2 year old hi-spec VW Golf). There is a perception that you get what you pay for and if you're offering an excellent service, people will pay a bit more for that.
As an example, we had an enquiry and quoted, and were told they'd had a cheaper quote. We said we weren't really prepared to come down on our price, but we had a bit of an email back-and-forth and he clearly wanted to use us, but he'd had a quote 20% lower than ours (yet clearly he preferred us over them). We came down 10% and he was happy to pay more than the lowest quote he'd had to get the service he wanted.
As Ian does, we check our time taken on a fixed price job and see what our effective hourly rate was. As it turns out for that particular job, on the time I actually spent, my original quote was fractionally high compared to our hourly rate, and the actual price was fractionally low, but it was good enough. Also, remember the first year is harder and takes longer as you're having to work with brought forward opening balances and getting to know the client. If you charge the same price and retain the client for a few years, the second year onwards will begin to make you more profit.
I've rambled a bit. Hope it helps.0 -
I used to use a fixed fee mapping sheet that calculates an appropriate quote based on size and nature of the business, services required and quality of the bookkeeping records.
It sounds great on paper but actually explaining and 'selling' it to clients was a little more difficult.
So now my fees are dead simple and the same for everyone:
Sole-traders:
Gold - £160 per month
Silver - £126 per month
Bronze - £84 per month
Starter - £42 per month
Limited companies:
Gold - £475 per month
Silver - £375 per month
Bronze - £250 per month
Starter - £125 per month
My tip: Don't undervalue yourself. You will be forever running around after clients who never pay you what you are worth.0 -
What does the Gold, Silver, Bronze and Starter mean Dean? (Just being nosy)0
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Basic difference is face to face contact at the clients premises.
Gold includes monthly meetings to discuss management figures.
Silver includes quarterly meetings to discuss management figures.
Bronze includes an annual meeting to discuss year end and planning.
Starter is purely remote. No travelling to client at all (except initial consultation of course).
There are other differences in terms of services included but they largely revolve around the contact time.0 -
Out of interest Dean, are those prices purely for year end and associated work, or are they inclusive of any bookkeeping?0
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I don't do any bookkeeping.
It is all year end work, advisory work throughout the year and compliance work throughout the year (VAT and payroll) unless also done by the bookkeeper.
Those on the gold service will also get monthly management accounts prepared from the bookkeeping records presented to me. Silver will get the same quarterly.0 -
Yeah, never undervalue yourself.
My charge out rates are £40 an hour, with a discount of £5 if completing regular monthly work.
I know where I have worked in the past about 6 years ago I was charged out at £55 back then.0 -
Thanks for your reply
Good morning,
Thank you very much for your reply to this post. This really makes sense. Again it's really hard to give a price out.
I hope to develop my own strategy to charge clients over time.
Thanks again to carjon, burg, Monsoon, deanshepherd, jewels.p, acsacsacs.
Kind Regards,
MSB0
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