Exploring a New Bookkeeping Partnership: Evaluating Our Pricing Strategy

Introduction

Hello! I’m excited to share that I’m embarking on a new venture with a colleague—launching a Bookkeeping company based in Canada. We feel fortunate to have a client base ready for us, as we’re taking over the responsibilities from a CPA who’s retiring. She previously handled both tax and Bookkeeping services.

Pricing Strategy

A key topic we’ve been deliberating is our pricing model. We’ve settled on a rate of $55 per hour. This decision comes after considering that the former CPA, who held a professional designation, charged $70 per hour. We’re curious to know if our pricing seems competitive and fair.

To ensure transparency and fairness in our partnership, we’ve opted to maintain our individual billable hours. This encourages us to seek additional clients if we aim to increase our earnings, diverging from the idea of splitting incomes 50/50 for all clients.

Our Experience and Services

I bring over five years of experience to the table, while my business partner has more than two years in the field. We provide a comprehensive range of bookkeeping services, including reconciliation, payroll, accounts payable/receivable, and GST/PST management.

Seeking Advice

We’re also eager to hear from other bookkeepers who have experience in partnerships. Any tips or insights you could provide would be immensely appreciated!

Thank you for taking the time to read about our journey. Looking forward to your thoughts and advice!

Starting a Bookkeeping partnership and setting the right pricing structure is crucial for your business’s success. Since you’re based in Canada and taking over clients from a CPA, you already have a great starting point. Here’s a detailed breakdown to help you assess whether your pricing is reasonable and some additional advice for your partnership:

1. Pricing Considerations

Market Rates

Research Local Market Rates: $55/hr seems reasonable, especially since the previous CPA charged $70/hr due to her designation. In Canada, Bookkeeping rates generally range from $30 to $80/hour, depending on experience and services offered.
Experience Factor: With 5+ years and 2+ years of experience, you and your partner are well-positioned. Consider slight adjustments as you gain more experience or niche expertise.

Value Proposition

Services Offered: Given you offer standard Bookkeeping services (reconciliation, payroll, AP/AR, GST/PST), ensure your clients understand the value they are getting. Highlight any additional expertise or personalized service you provide.
Client Retention: If many clients are transitioning from the CPA, maintaining a slightly lower rate initially could help in retaining them, especially if they’re used to the CPA’s qualified services.

Revenue Model

Billable Hours: Your model of keeping your own billable hours is fair and incentivizes both partners to bring in their clients. This structure supports growth and can increase overall revenue.
Rate Adjustments: Consider evaluating your rates annually. As your experience and client base grow, or if you offer additional services, incrementally increasing rates can be justified.

2. Partnership Advice

Clarity and Communication

Define Roles and Responsibilities: Clearly outline who handles what aspects of the business (client communication, bookkeeping, business development) to avoid overlap and ensure efficiency.
Regular Meetings: Schedule regular check-ins to discuss business development, client feedback, and financial goals. This helps in maintaining a cohesive vision for the partnership.

Maintaining a Good Partnership

Equitable Workload: Ensure that workload distribution matches compensation. If one partner is bringing in more clients or handling more complex tasks, there should be discussions around compensation adjustments.
Written Agreement: Have a formal partnership agreement that outlines roles, profit-sharing, how conflicts will be resolved, and plans for dissolution if that ever becomes necessary.

Peer Insights

Networking with Other Bookkeepers: Connect with other

One response

APAdmin

26 February 2025 at 2:54 PM
Starting a Bookkeeping partnership and setting the right pricing structure is crucial for your business’s success. Since you’re based in Canada and taking over clients from a CPA, you already have a great starting point. Here’s a detailed breakdown to help you assess whether your pricing is reasonable and some additional advice for your partnership:

1. Pricing Considerations

Market Rates
- Research Local Market Rates: $55/hr seems reasonable, especially since the previous CPA charged $70/hr due to her designation. In Canada, Bookkeeping rates generally range from $30 to $80/hour, depending on experience and services offered.
- Experience Factor: With 5+ years and 2+ years of experience, you and your partner are well-positioned. Consider slight adjustments as you gain more experience or niche expertise.
Value Proposition
- Services Offered: Given you offer standard Bookkeeping services (reconciliation, payroll, AP/AR, GST/PST), ensure your clients understand the value they are getting. Highlight any additional expertise or personalized service you provide.
- Client Retention: If many clients are transitioning from the CPA, maintaining a slightly lower rate initially could help in retaining them, especially if they’re used to the CPA’s qualified services.
Revenue Model
- Billable Hours: Your model of keeping your own billable hours is fair and incentivizes both partners to bring in their clients. This structure supports growth and can increase overall revenue.
- Rate Adjustments: Consider evaluating your rates annually. As your experience and client base grow, or if you offer additional services, incrementally increasing rates can be justified.
2. Partnership Advice

Clarity and Communication
- Define Roles and Responsibilities: Clearly outline who handles what aspects of the business (client communication, bookkeeping, business development) to avoid overlap and ensure efficiency.
- Regular Meetings: Schedule regular check-ins to discuss business development, client feedback, and financial goals. This helps in maintaining a cohesive vision for the partnership.
Maintaining a Good Partnership
- Equitable Workload: Ensure that workload distribution matches compensation. If one partner is bringing in more clients or handling more complex tasks, there should be discussions around compensation adjustments.
- Written Agreement: Have a formal partnership agreement that outlines roles, profit-sharing, how conflicts will be resolved, and plans for dissolution if that ever becomes necessary.
Peer Insights
- Networking with Other Bookkeepers: Connect with other
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New bookkeeping partnership, does the pricing make sense?

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