Exploring a New Bookkeeping Partnership: Is Our Pricing Strategy Sensible?

I am embarking on an exciting new venture with a colleague as we launch a Bookkeeping company based in Canada. Fortunately, we already have a roster of clients lined up, as we are taking over from a CPA who is retiring and closing her business, which offered both tax and Bookkeeping services.

One of our initial focus areas is setting our pricing strategy, and we’ve agreed upon charging $55 per hour. However, I’m keen to hear whether this seems like a reasonable rate. The previous CPA charged $70 per hour, justified by her professional designation.

To ensure fairness in our partnership, we’ve decided that each of us will maintain our own billable hours. This approach means that if either of us wants to increase our earnings, we have the autonomy to attract new clients independently, rather than splitting all revenue equally.

With over five years of experience on my end and my business partner bringing over two years to the table, we plan to offer a comprehensive range of standard services, including reconciliation, payroll, accounts payable/receivable, and GST/PST management.

I would love to hear from fellow bookkeepers, especially those who are in partnerships, regarding any advice or insights you might have.

Thank you!

Starting a new Bookkeeping partnership is an exciting venture, and it’s great to hear that you already have a base of clients transitioning from a CPA who’s closing her business. Pricing your services appropriately is crucial for both attracting clients and ensuring your venture is profitable and sustainable. Let’s delve into your situation and consider some factors that can help determine if your pricing of $55/hour makes sense.

Pricing Considerations

Market Research:
Industry Standards: It’s important to research what other bookkeepers in your region, particularly in Canada, charge for similar services. Rates can vary significantly based on location, experience, and services offered. Your rate of $55/hour seems competitive given that CPAs typically command higher fees due to their additional qualifications and tax services experience.
Local Competition: Consider the rates of other local bookkeepers. This can provide a benchmark for ensuring your pricing is neither too high to deter clients nor too low to undervalue your services.
Experience and Expertise:
With your 5+ years of experience and your partner’s 2+ years, combined with the variety of services you offer (reconciliation, payroll, accounts payable/receivable, GST/PST compliance), $55/hour is reasonable. Continuing to expand your expertise, especially in specialized areas, could justify raising rates in the future.
Service Differentiation:
If you offer any specialized services that aren’t commonly available, you could position these as premium offerings, potentially justifying higher rates.
Value Proposition:
Emphasize the value you provide versus just the cost per hour. Clients often appreciate reliability, accuracy, and the peace of mind knowing their financials are handled competently. Try to highlight past client successes or testimonials to reinforce this.

Billing Structure

Hourly Rate vs. Fixed Pricing: While you have settled on an hourly rate, it might be beneficial to consider offering fixed-price packages for certain services. Clients often prefer predictable costs, and it allows you to leverage efficiency improvements without reducing your revenue.

Partnership Dynamics

Billable Hours Structure: It makes sense to keep your own billable hours, especially if you’re independently responsible for finding additional clients. This encourages individual initiative and fairness based on work done.

Advice for Bookkeeping Partnerships

Clear Communication and Documentation:
Ensure that all agreements, expectations, and responsibilities are clearly documented. This can include how expenses are shared

One response

APAdmin

25 February 2025 at 8:20 PM
Starting a new Bookkeeping partnership is an exciting venture, and it’s great to hear that you already have a base of clients transitioning from a CPA who’s closing her business. Pricing your services appropriately is crucial for both attracting clients and ensuring your venture is profitable and sustainable. Let’s delve into your situation and consider some factors that can help determine if your pricing of $55/hour makes sense.

Pricing Considerations
1. Market Research:
2. Industry Standards: It’s important to research what other bookkeepers in your region, particularly in Canada, charge for similar services. Rates can vary significantly based on location, experience, and services offered. Your rate of $55/hour seems competitive given that CPAs typically command higher fees due to their additional qualifications and tax services experience.
3. Local Competition: Consider the rates of other local bookkeepers. This can provide a benchmark for ensuring your pricing is neither too high to deter clients nor too low to undervalue your services.
4. Experience and Expertise:
5. With your 5+ years of experience and your partner’s 2+ years, combined with the variety of services you offer (reconciliation, payroll, accounts payable/receivable, GST/PST compliance), $55/hour is reasonable. Continuing to expand your expertise, especially in specialized areas, could justify raising rates in the future.
6. Service Differentiation:
7. If you offer any specialized services that aren’t commonly available, you could position these as premium offerings, potentially justifying higher rates.
8. Value Proposition:
9. Emphasize the value you provide versus just the cost per hour. Clients often appreciate reliability, accuracy, and the peace of mind knowing their financials are handled competently. Try to highlight past client successes or testimonials to reinforce this.
Billing Structure
- Hourly Rate vs. Fixed Pricing: While you have settled on an hourly rate, it might be beneficial to consider offering fixed-price packages for certain services. Clients often prefer predictable costs, and it allows you to leverage efficiency improvements without reducing your revenue.
Partnership Dynamics
- Billable Hours Structure: It makes sense to keep your own billable hours, especially if you’re independently responsible for finding additional clients. This encourages individual initiative and fairness based on work done.
Advice for Bookkeeping Partnerships
1. Clear Communication and Documentation:
2. Ensure that all agreements, expectations, and responsibilities are clearly documented. This can include how expenses are shared
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New bookkeeping partnership, does the pricing make sense?

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