In an earlier blog post, “Time is fast running out” I explored the reason why the accounting profession will soon have to move all clients and the accountancy services onto a cloud accounting system.
In fact, many accounting and bookkeeping firms are now doing this. After all, setting up a business on a cloud accounting system, such as QuickBooks Online, is a very valuable service.
But here’s the crazy thing
Throughout 2016, I surveyed over 1,000 accounting and bookkeeping firms and asked the question, “If you’re moving somebody onto a cloud accounting system, and let’s assume it’s a fairly straightforward situation where their existing accounting system fully reconciles and balances, how much do you charge for that?”
Every time I’ve asked this question, between 30 – 40% of the audience do it for free. And almost everyone else charges a very small amount of £400 or less.
That’s undervaluing our accountancy services so much.
Setting up a business with an accounting system is highly skilled work and highly valuable and our prices should reflect that. We certainly should not be doing this for free.
This is what’s possible
Let me tell you a quick story. Back in December 2014 I met a very forward-thinking accountant. She’s completely committed to moving clients to the cloud and she loves QuickBooks Online.
But, she told me, she didn’t know how to charge for it, so she ended up giving the service away for free.
In January 2015, I started working with her to create a system that included providing clients with a choice of three different accounting services . In March 2015, she relaunched her cloud set up accountancy services and the three packages. Just two months later she told me, “This stuff is amazing. In the last two months I’ve had five meetings with clients or prospective clients. I’ve had a 100% success rate moving people onto the cloud using my packages. And what’s really interesting, not one of them has chosen the cheapest package. They’ve all gone for the more expensive options. In every single case I’ve earned over £1,000.”
In fact, this accountant told me in those two months she had added over £7,000 of fees from moving 5 clients onto QuickBooks Online. Prior to that, like so many accountants and bookkeepers, she’d given away those accountancy services for free.
That’s over £7,000 of extra profit in just two months!
Thanks to Making Tax Digital and advances in technology, over the next couple of years you are going to be moving a lot of businesses onto the cloud. It’s highly valuable work and it’s also a huge opportunity. You can, and should, charge a good value-based price for doing it.
As long as you have the right pricing systems in place, just like this forward-thinking accountant, you should be getting £1,000 for a simple migration to QuickBooks Online. And much more for more complicated cases requiring data clean up first.
That’s a big opportunity, so make sure you’re ready to seize it.