How a Bookkeeper Increased Her Prices by Almost 60% After 12 Months - Interview with Lana Jo Hill

inspiring stories Feb 21, 2022

 

I interviewed Lana Jo Hill in July 2020 because she was having extraordinary pricing successes, despite some personal challenges and the world going into lockdown.  Lana talked about scope creep and the importance of working with the right clients.

If you would prefer to watch the full interview, you can find it on my YouTube Channel here: https://youtu.be/HACoKZ77ltU

 


 

Lana Jo Hill’s Success Story

 

Lana owns her own virtual bookkeeping firm, Hill Bookkeeping and Consulting, based outside of Baltimore, Maryland. The business will soon be reaching its fifth year.

Lana started her virtual bookkeeping business to fulfil her passion for helping small businesses grow. Having a virtual business is also perfect for Lana as it allows her to spend more time with her two young boys whilst still continuing to earn an income.

  

The challenges Lana faced

 

One of the biggest challenges Lana has had to face is scope creep.

Her clients weren’t understanding that she was only hired to do one job, and all the extra things they were asking for were causing her more work and hadn’t been covered in the fee. In an interview we had together, Lana told me, “Clients didn’t understand that no, you hired me to do ‘A’, and now you’re asking me to do ‘B’, ‘C’ and ‘D’ as well!”

These clients then became reluctant to actually pay the bill in the end. This was especially difficult for Lana as she was trying so hard to provide for her family and put food on the table, but her clients were refusing to pay.

Another big issue that Lana had to deal with was the tax season rush.

In the US, the tax year end is in April, so come January everyone panics, and Lana would get a huge influx of inquiries and new clients all wanting her to bring their books up to date and file for taxes. Those clients were expecting her to work miracles and get a whole year’s worth of bookkeeping done in just a few weeks, or even days!

Lana ended up, in her words, “Working myself to the bone” during those few months.

 

How did Lana turn it all around?

 

The first thing that Lana did, is she started learning. She signed up for my How To Price Bookkeeping Services course and started making tiny changes here and there to her business.

Eventually something clicked for Lana and she decided that if she was going to make these changes then she needed to put her all into it and implement her new learnings in her whole business. She did two big things:

Firstly, she asked herself: “Who are the people I really want to move forward with?” Lana spent some time considering what her ideal type of client was and which of her current clients fit that description.

Lana said, “I’m only moving forward with clients that I really want to spend my time with and that I really want to work with.”

Secondly, she re-priced her existing clients. She discovered that she had been working with some of her clients for over a year and had never increased the prices. She could see from the figures that those businesses were growing and thriving from the work she had done for them.

She approached those clients for a pricing update and the responses were overwhelmingly positive!

 

For new clients, she ramped it up even further

 

They would first have a diagnostic review – which Lana charged for – allowing her to work out the scope of the work and also get a better sense of what kind of client she was looking at. She could then vet the bad clients and offer the right packages to the good clients.

Lana told me, “It’s ok if I’m not the right fit for every single business owner because the people that are signing up are paying me 50% more than I would have priced before – and I have higher quality clients.”

By being strict in who she decided to work with, and by raising her prices by 50%, Lana found she had much more time to spend on each client – and more free time to spend with her family! She didn’t have to worry about taking a day off because she knew the firm was making money and her bills would be paid.

Due to her success, Lana’s business is now at a point where she is looking to expand and scale it up to a much higher level taking on more employees and continuing to give the same level of service to all her clients.

 

How Lana managed to axe so many clients

 

Lana got rid of her bad clients in four waves. Some of them were intentional, but some came by unexpectedly.

Getting rid of so many of her clients was a really brave thing to do. But Lana was able to do it because of her own past experiences. She told me, “I spent 10 years working in retail and small business banking. I had to welcome any client that walked through the door with a smile and provide a really great service. I put up with a lot of abuse from people. I’ve been yelled at, I’ve been called names... One of the things I agreed for my own firm was never to work with any jerks.”

 

How Value Pricing changed Lana’s business

 

After implementing this new value-based approach to pricing, Lana has noticed some really big changes in her business and in her own personal mindset. She told me, “I have increased confidence and peace of mind as a business owner. But it’s also led me to feel like I can reach out to my clients with anything.”

Because of Lana’s decision to only work with her ideal clients, she feels much more comfortable reaching out to them with suggestions on how they can save more money, grow their profits or take their business to another level.

Having these great relationships with her clients also helps her to plan ahead. She can see how much money she is expecting to make over the next couple of years, predict the workload and make more educated decisions about hiring new staff and growing the business.

With value pricing, Lana doesn’t need to worry about putting food on the table.

 

Lana’s Top Tips

 

I asked Lana what her three top tips would be. She answered:

  1. You have to spend some time planning and working out what is important to you as a business owner. What do you want your business to look like? What kind of clients do you want? What are you going to put in your packages?
  2. Don’t under-price yourself! Anytime you feel like you need to increase your prices, just be really open and honest with your clients. Start planning ahead with their contracts and look at what else they might need or want down the line. There will often be clients that are willing to spend more money or go for a higher package.
  3. Don’t waste your time on clients that you already know are not going to be a good fit. Know who your ideal client is and be strict with who you take on. It will be hard at first, but when you know someone isn’t right, turn them down. If you know someone isn’t right, you could even use them to practise your value pricing techniques. Ask for their QuickBooks file, show them your proposal and packages. Any feedback you can get is valuable.

 

If you want to watch the full video with Lana, go to https://youtu.be/HACoKZ77ltU

 


 

If you found this valuable and would like to learn more about value pricing, I run a free live online training session every month with a topic chosen by you. Attend live and you can ask me any questions you have. Click here to register and I will send you an invitation to the next session.

And if you would like to join a community of like-minded accounting professionals learning to price more effectively and confidently, you can join my Facebook Support Group here.

 

Wishing you every success on your pricing journey.

Mark Wickersham

Chartered Accountant, Public Speaker and Author of Amazon No.1 Best Seller “Effective Pricing for Accountants”

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