Institute of Certified Bookkeepers
First Previous - Page 1 of 1 - Next Last

My charge rate

  • 5 posts
  • # 100162

Good evening.

I have a dilemma which I am hoping you can help me solve. My current charge rate is $55 per hour and it appears to be too high for people and as a result I am having difficulty landing clients. I currently have one client, but I am actively looking for more via various marketing means. I am thinking about reducing the rate to $40 per hour, but I am worried that it may undermine the ICB brand, given that the ICB guidelines for charge rates are between $45 and $65 per hour. I feel I have no choice but to drop my rate otherwise I will not get any more clients.

A bit of background on me. I have a certificate 4 in bookkeeping, together with a diploma in accounting. I am competent in Quickbooks (soon to become a Pro Advisor), Xero (I am a Certified Xero partner) and MYOB (soon to become a Certified Consultant). I have only been established since earlier this year, hence just the one client.

I appreciate any advice.

Regards.

Alan Morgan.

  • Fellow in Practice
  • Practice Certificate
  • 51 posts
  • # 100170

Hi Alan,

I think it depends on the methods of how you market your services to set your charge out rate. In my case, my charge out rate is $65 per hour, plus travel, plus $30 for each BAS or IAS lodgment through the ATO portal, plus GST. My method is through referrals by accountants only. Currently I am working with four independent accountants, and none of them wants a kick back. The beauty is a client never queries my charge rate because the client thinks that if I was referred to by their accountant, then I must be good enough to take control of their books lock stock and barrel. I do not advertise my services through any other source. It was a lot of hard work initially though going door knocking to try and team up with the various accountants.

This is my method of getting clients but I would imagine that there must be other bookkeepers out there who can charge between $45-$65 per hour depending on their marketing strategy.

Remember too, If you decide to go lower to $40 per hour, you’re probably locked in on that price for a few year as no client would like price increases since you are not really doing anything different from year to year. In fact, it should take a lot quicker to complete the job once you get to know their business operations.

Looking forward to hear from any other feed backs.

Richard Lowe.

  • Fellow in Practice
  • Practice Certificate
  • 70 posts
  • # 100171

Hi Alan

I heard via a newsletter today that the average charge-out rate for an Australian bookkeeper is $48/hour. Alan, are you an average bookkeeper? If not, what do you offer that makes your service compelling and above-average? Being clear about this will help you sell what you are offering and feel confident in commanding a higher rate. We charge between $60 - $80/hour plus GST depending on volume and no one complains. We charge even higher rates for rescue work and setting up data files.

I agree with Richard that offering a low rate will lock you in for some time. It's tempting when you're struggling to find work. My strategy is also based around referrals, some of which do come from accountants. I find that end-of-year software Christmas parties are a great way to network with accountants and pick up some business cards and then contact in the next year. In addition, doing what you do, really well, will make an impression with the accountant. Don't be shy about pointing out what you have achieved for their client. Make an appointment to meet them to introduce yourself, (it doesn't need to be to discuss the client specifically, although you might also choose to do this). Ask them if they need a good bookkeeper they can refer to clients and if there is any way that you could prove yourself to them. I also agree with Richard that if a referral has come via an accountant, then you can ask your price and they will accept because they will trust their accountant's advice, (usually).

I've tried door-knocking and have won business this way, but none of those three clients I picked up that way were long-term. I even sacked one of them. However door knocking is a great way to build your confidence and will help you refine your elevator pitch. I wouldn't discourage it. What I would discourage is general advertising. I have not found this to be effective at all.

Be relentless in networking with others, be awesome at what you do, keep learning new things, offer more than just bookkeeping, be an invaluable business advisor and work will come pouring through your door.

Kind Regards
Carmen

 

  • Fellow in Practice
  • Practice Certificate
  • 51 posts
  • # 100179

Hi Carmen,

Well said and well written! I couldn’t agree with you more! You must have put a lot of thought into it to put this in writing. I hope others who are starting out might benefit from these points.

Richard Lowe.

  • Member in Practice
  • Practice Certificate
  • 15 posts
  • # 100335

Hi Alan,

Yes it is hard to set started especially if you are new to a city as I was!

Gumtree has proven to be the best source of advertising; though I spent weeks building my website and even put an ad in the local paper!

I did charge my first client the lowest rate $40 as they needed a lot of help and I knew they would be long term.

I can happily now call them 'friends' as well!

I now charge $50 per hour and a one off $66 for BAS Lodgments as well as provide MYOB training (at a cheaper rate and at their premises) to business owners who are eager to learn and would like be more involved in doing some of the work themselves.

I officially started February the 28th 2014, and now have four clients with a fifth to come on board June 30, 2014

I worked in accounts for many years, for small and large businesses - always using MYOB which seems to be the most popular software, as well as having HR experience as well as running my own small business for two years.

My father was a Maths teacher and my brother is a CPA and Financial Advisor, so I suppose you could say it runs in the family!!

I have one client through a referral from an accountant whom I am not too keen on working with. Luckily I got the name of another accountant from an ICB seminar and now she is going to refer me to any of her clients that need a bookkeeper.

One other thing I am a mobile service. This has made a difference to all my clients.

Good luck Alan!!

 

Kind regards,

Pamela M Anderson

BAS Agent: 24717459

Website: www.correctcode.com.au 

  • Fellow in Practice
  • Practice Certificate
  • 22 posts
  • # 100376

There isn't a one size fits all rate. We were charging $65/hr or $80/hr but are putting the $65 to $70 from 01/07/2014. We are also charging $150/hr for training and ad-hoc support etc. I had my first query on a rate 1 month ago. We have over 100 files we work on.

 

You can get around the $/hr barrier by quoting a fixed fee for the work. Especially if the work you are doing is offsite. Charge for the service, not the time taken. Initially you're hourly rate might be a little lower but as you become more competent with that client's work you'll get quicker, and this then raises your effective hourly rate. You do need to be clear what that fee does and doesn't cover.

  • 1 post
  • # 113838

Its a nice web page to gain some knowledge about Bookkeeping Services since I was in a search about Bookkeeping Services Perth.I am glad to join this group and I have laearnt a  lot from this page.

  • Fellow in Practice
  • Practice Certificate
  • 206 posts
  • # 113843

Hi

 

Another great resource is our Facebook Closed group for members.  If you are a member of ICB the link is:

https://www.facebook.com/groups/129790417074481/

First Previous - Page 1 of 1 - Next Last
loading