How Much Are Clients Willing to Pay for your Advisory Services?
Understanding what a person or small business is willing to pay for your advisory services is probably one of the biggest challenges facing CPAs today. As advisory services are still relatively new for CPAs to offer, there isn’t a standard set of pricing “rules” and of course, depending on who you want to take on as clients, it’s always variable.
So, how can your firm show value to your clients through advisory services, without seeming greedy or charging too high of a price?
The answer here is never clear cut, but instead is determined by a few factors, including:
- What are you currently charging for your services?
- What additional services are you offering?
- What are your competitors charging?
- How do you want your firm to be perceived?
Let’s start with the obvious one, what are you currently charging for your services?
If you have positioned yourself as a budget CPA firm and thrive on providing services at below market rates in order to attract extremely small businesses and entrepreneurs, you can’t jack your rates sky high and expect your consumers to understand.
If you’re trying to break into a different market with your advisory services, that is a different scenario. But if this is meant to be an “add-on” or bonus option for your clients, you can’t pull the wool over their eyes.
What additional services are you offering?
This more refers to how you are structuring your advisory services. If you’re charging an hourly rate, be sure to choose something that is reasonable for you to provide a complete and comprehensive evaluation in a few hours.
Consider whether you’re charging for phone calls or video meetings to explain your advisory services, and whether follow up calls will be included.
What are your competitors charging?
If you are aware of any competing CPA firms in your area (or in your niche) that offer advisory services, consider what they’re charging and consider matching them or trying to swoop in with your superior offer at a slightly lower price (below market rate).
How do you want your firm to be perceived?
If you’re already a “high class” firm or have a prestigious reputation, your pricing needs to reflect this reputation. Of course, your services need to provide enough value to your clients in order for them to be “worth it”, so consider how you are demonstrating your value.
Do you have case studies of your successes with advisory services on your website? If you have no experience in advisory services, consider offering them to current clients at a discounted rate while you build your portfolio and slowly transition into higher rates as your business continues to grow.
Do you currently offer advisory services to your clients? If so, what sort of pricing do you use? If not, what’s holding you back? Let us know at www.dryrun.com/partners/