Paying for bookkeeping services can sometimes be an expensive monthly surprise, but it doesn’t have to be that way. Before you commit, it’s important to understand how different bookkeeping services calculate their prices and what’s included in the fee.
As you compare bookkeeping service options, let us explain what differentiates Virtueshore’s pricing. We’re not your typical finance company; our service plans are unique. Virtueshore offers comprehensive outsourced bookkeeping and accounting services for startups and small businesses. In addition to accurate and fast daily bookkeeping that meets industry standards, you also get a dedicated finance expert and access to a real-time finance dashboard that presents your financial information in easy-to-understand reports. Continue reading to discover more about
Virtueshore’s pricing, the value they provide, and how it compares to traditional bookkeeping services and their pricing models.
How are Bookkeeping Costs and Services Typically Structured?
Each bookkeeping service offers a slightly different set of tasks, but any bookkeeping expert you hire should keep accurate and updated records of all your company’s money-related activities using special accounting software. This includes everyday transactions, money coming in, and money going out.
A bookkeeper might also handle daily money tasks like paying bills and getting paid by customers. They ensure the numbers in your payroll and bank accounts match up correctly and create monthly financial reports. However, most traditional bookkeeping services only give you this info weeks after the month ends. You can only see what happened in the past; you can’t make decisions for the current month.
So, if you want to know why you spent more money this month before you get the official report, you’d have to ask for details, wait for a response, and pay your bookkeeper for the time they spend finding and sending you the information.
Key Elements of Bookkeeping Price Packages
When it comes to bookkeeping prices, there are several factors to keep in mind. Here’s what you should consider when determining the cost of your bookkeeping services:
1. Client Size
Tailoring your bookkeeping price packages for different client sizes is essential. Small, medium, and large businesses have varying needs and budgets. Smaller clients may require less extensive bookkeeping tasks and generate lower revenue, so consider charging them less.
However, keep in mind that the amount of work performed should also factor into the pricing equation. Sometimes, a smaller company might require more work than a larger one, justifying a higher fee.
2. Geographic Location
Bookkeeping prices can vary depending on where you are located. Different regions or states may have additional average monthly bookkeeping costs. Research the local market to understand the pricing norms in your area.
For instance, the cost of bookkeeping services in California might differ from that in Connecticut.
3. Certifications
Bookkeepers with professional certifications often command higher fees for their services. Clients value qualifications that demonstrate expertise and competence. The more certifications a bookkeeper holds, the more they can charge for their services.
4. Level of Experience
Experience is a valuable asset in the bookkeeping field. Bookkeepers with years of experience earn more than those just starting their careers. Clients often see experienced professionals as more capable and reliable, which can justify higher pricing.
5. Increased Demand
Like any other, bookkeeping services can be subject to supply and demand dynamics. Prices may increase when there’s a high demand for specific bookkeeping services.
Factors such as economic or technological changes can drive demand. In such situations, bookkeepers can charge more, especially if the supply of qualified professionals doesn’t meet the demand.
6. Service Frequency
Bookkeeping projects can be priced based on their frequency—whether they’re one-time, monthly, quarterly, or annually. A common practice is to offer reduced fees to clients who require frequent services.
Clients with one-time or sporadic needs may pay higher fees, particularly if their project involves a substantial workload, and the relationship may not continue beyond that project.
Considering these factors, you can determine appropriate bookkeeping prices that align with your client’s needs, qualifications, and local market conditions. It’s important to strike a balance between offering competitive rates and ensuring your services reflect the value you provide.
The Unpredictable Nature of Traditional Bookkeeping Fees
Traditional bookkeeping costs can take time to predict. Typically, you pay based on your bookkeeper’s hours managing your finances.
This means your monthly bill can fluctuate due to various factors:
- Account Count: If multiple financial accounts (like credit cards and bank accounts) are linked to your business, each one adds complexity and requires more time. Some providers may charge extra for each additional account.
- Transaction Volume: Some months might have more transactions, such as invoices and bank transactions, leading to higher fees during busier times.
- Business Expenses: Any business-related expenses and regular payments contribute to the workload for your bookkeeper.
- Revenue Collection: How you receive income matters too. Automated, recurring charges are easier to manage than manual invoicing, which can be more time-consuming.
During peak months, your bookkeeper may spend many billable hours ensuring everything is correctly categorized and reconciled in your accounting software. Consequently, you’ll pay more for traditional bookkeeping services precisely when you prefer cost savings. While most bookkeeping services offer estimated monthly costs, the unpredictability of hourly billing makes pinpointing your exact monthly expenses challenging.
Understanding Bookkeeping Service Pricing Models
When it comes to pricing bookkeeping services, there are three common models to consider:
- Hourly Pricing: With this model, you pay based on the hours the bookkeeper works on your accounts. However, this approach can lead to cost uncertainty and may differ from the most predictable option.
- Fixed Fee Pricing: Fixed fee bookkeeping packages offer a clear advantage. You know exactly how much you’ll pay each month, allowing for better budgeting and avoiding unexpected costs. This pricing model is popular among clients because it provides cost stability.
- Value Pricing: It is a flexible approach in which the cost depends on the perceived value of the services provided. It can vary from client to client and is often used for specialized or complex projects.
Among these options, fixed fee pricing stands out as the preferred choice for many clients. It offers transparency, ensuring you have a set monthly cost without surprises. Unlike hourly pricing, fixed fee packages are not tied to the number of hours worked but are based on the agreed-upon scope of services.
Fixed fee bookkeeping packages work best for long-term contracts with clearly defined tasks. They allow you to focus on the monthly results rather than worrying about hourly rates or wasted time.
For New Clients, Craft Comprehensive Bookkeeping Price Quotes
Creating a well-structured pricing quote is essential when you’re a bookkeeper looking to win over new clients. A comprehensive quote showcases your professionalism and helps your potential prospects understand the value you bring to their business.
Here’s what you should include in your pricing quote:
- A cover letter
- Bookkeeping service price list, summary, or table
- Project timeline or schedule
- Your bookkeeping business details or information
- Identification and reference information (e.g., client and/or quote number)
- The business details of your prospective client
- Contract terms and conditions
- ‘Valid until’ date
- Signature
By including these components in your pricing quote, you not only present a professional image but also ensure that you and your potential client are on the same page regarding the scope, cost, and terms of your bookkeeping services. It’s an important step in building a successful and transparent business relationship.
VirtueShore: Your Trusted Partner for Efficient Bookkeeping Pricing Packages
In the world of bookkeeping, being efficient and cost-effective is crucial. If you offer monthly bookkeeping services, having reliable accounting software is a must in today’s digital age.
That’s where VirtueShore, an outsourcing company, comes into play. They specialize in providing efficient and budget-friendly solutions and have developed all-in-one software for bookkeepers, accountants, and small business owners.
The best part?
You don’t need a big budget or advanced technical skills to benefit from VirtueShore. It’s the ideal choice for those seeking simplicity and affordability in their bookkeeping efforts. With VirtueShore as your partner, you can streamline your bookkeeping processes and concentrate on what matters most—growing your business.
