There are a number of certifications you can get as a bookkeeper. And in turn, these certifications can increase your expertise (and your pricing). Bookkeeping is the process of categorizing all your income and expenses into a clear reporting structure. Accountants are facing significant changes due to Making Tax Digital (MTD), a crucial aspect of the UK government’s tax strategy. ACCA’s chief economist Jonathan Ashworth scrutinises inflation predictions amid interest rate rises and growth concerns Read More… Bookkeepers can also ensure unpaid invoices are chased, which otherwise could be forgotten about – especially if a business has a high number of invoices going out every month.
Take a look at industry averages, rates by state, and more to get an idea of how much to charge your clients. Do your research ahead of time to find average rates for services in your state. If needed, make adjustments to your pricing to reflect costs in your locality or state. Even if you aren’t planning on growing any time soon, you need to have a sense of how much money is coming in vs. what is going out.
How the right financial systems can reduce the cost of bookkeeping
But it can still be overwhelming to handle your financial recordkeeping on your own. So let’s break down the various bookkeeping options, who they’re best for, and how much you’re likely to spend on them. An in-house bookkeeper will often cost you more than an outsourced bookkeeper, although hiring one so gives you more oversight and control over your bookkeeping. Bookkeepers keep track of a business’s earnings and expenses, ensuring all financial records are in order. Growing small businesses inevitably meet the challenge of their internal accounting methods no longer being sustainable.
One standard pricing structure is to charge an hourly rate, which is what accounting firms traditionally used and many still use today. A large corporation may place a higher value on bookkeeping services that help them stay compliant with government regulations and audits. They may be willing to pay a higher rate for bookkeepers with specialized training or certification in auditing and accounting. However, location plays less of a role now than it used to because everything is virtual, and you can serve small business clients worldwide.
Factors to Consider as You Figure Out Pricing for Your Bookkeeping Services
Schedule your free 30-minute consultation, and we’ll pair you with one of our account managers, who will recommend the best package for you. You can talk through questions, challenges, and goals and get one-on-one help to ensure your books are in the best shape possible. Based on your unique business situation, we will match you with the account manager who best meets your needs.
For example, you could charge an hourly rate for some services and a flat rate for others. Just be sure to be transparent in your engagement letter so both you and your client are clear on the pricing structure and terms. Value-based pricing is a good option for bookkeepers who are confident in their abilities and can provide a high level of value to their clients. It allows you to charge more for more valuable services to your clients, which can result in higher profits. The third option is to price your services based on their value to your clients.
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If you are working monthly, you can set up a recurring payment plan allowing your clients to make automatic monthly payments that come right out of their bank account. Fixed fee pricing is an attractive option for both bookkeepers and clients. For bookkeepers, it provides a guaranteed expected income, and for clients, it ensures that they will not be surprised by a large bill at the end of the month.
- Therefore, even before having a big team and many employees, it is essential to invest in keeping records of everything.
- But our ability to offer high quality bookkeeping services at such a low price is due to a combination of our focus, experience and technology.
- Now, let’s lay the argument of in-house vs. outsourced bookkeeping squarely on what this looks like in application – with real dollars-and-cents.
- If you are doing business and can simultaneously handle certain aspects of the accounting each month but need small help, a part-time bookkeeper can assist your company in this.
- Value pricing is a bookkeeping method that assesses the value of products or services based on their perceived worth to the customer rather than on their actual costs.
- The hourly wage for individual bookkeepers typically varies from $29.21 to $43.40.
However accountants will tend to charge much more than bookkeepers. The work which takes a qualified freelance bookkeeper a few hours per week could be costly and time-consuming if businesses did the bookkeeping themselves. Our goal is to get you due diligence ready, and we charge an onboarding fee to get your financials and books in order. There may be additional costs to correct previous months’ financials. However, remember more accountants and bookkeepers are working remotely.
Charge your worth when it comes to bookkeeping services
At minimum, they need to provide you with an office space, a desk, and a computer. As a contractor, you’re using all your own equipment, so you’re saving them all of that money. As a contractor, the main thing that you are saving an employer–or your client in bookkeeping pricing packages this case–is TAXES! They have to pay so much more in social security, Medicare, worker’s compensation, and unemployment taxes for an employee. When you work for a company, and they give you a W-2, they are paying a bunch of money to have you working for them.
- These functions are essential parts of a business, and it’s vital business owners have this expertise to manage a company properly.
- The key to accurately pricing is understanding and showcasing your value to your clients and prospective clients and then price your worth appropriately.
- When you’re first starting out, it’s hard to get a grasp on that, though, which is why I like to put it based on terms of approximate hours worked.
- A full-time bookkeeper is typically expected to handle everyday accounts, keep account books in order, and take care of tasks that are small and large (invoicing, timesheets, generating reports, etc).
- This pricing structure is most common with businesses that have a high sales volume and low transaction volume—such as businesses that sell physical products.
- A full-time bookkeeper with plenty of experience can manage anywhere from 5 to 20 clients.
- While this makes it easier to control your bookkeeping costs, most small businesses require consistent services to keep their books straight.
You may want to charge a lower price if you only offer basic bookkeeping services, like data entry and financial statements. The price should match the time you expect to spend completing the work each month. A small business client may see the value in bookkeeping services that help them save time and money.