Do you charge clients for QBO? You shouldn’t!
As the Amazon number-one best-selling author of Effective Pricing for Accountants, I’d like to share why, when you're moving clients onto a cloud accounting system such as QuickBooks Online, you should bundle the cost of the software into the cost of your solution.
The reason is that it reduces the number of pricing decisions clients have to make. And to prove to you how important that is, I’d like you to think about the last time you bought something online. If you buy from Amazon, for example, I’m sure you’ll have noticed that pretty much everything they sell offers free package and posting.
It may not be rational - but it works!
About a year ago I was buying some batteries on Amazon. As usual, when I typed ‘batteries’ into the search box, back came a whole load of different options within the Amazon marketplace. I clicked on the cheapest, added it to the shopping basket and was about to check out when I noticed the cost of postage and packing.
I remember thinking, “That’s a lot of money just for postage and packing.” So I went back to my initial search and picked something with free postage. What I didn't realise at the time though – it only occurred to me afterwards – was that I actually ended up paying more this way. The cost of the batteries – even with free postage and packing – was actually more than the first option I’d chosen of cheaper batteries with postage and packing added on.
In other words, I ended up choosing to spend more money. Completely irrational I know, but I’d made the decision that I didn't want to pay for postage when there were free options.
One solution is always more tempting
It’s exactly the same when you talk to clients about doing their bookkeeping or setting them up on the cloud. If they have to subscribe to the software separately, they have to make two different decisions. “Should I buy the solution from this accountant or bookkeeper?” And then “What about the cost of the software? I'm not sure I can justify it.”
That’s why I’d strongly suggest you always take that decision away from them. Offer them one overall solution. Although people sometimes say, "But that means I've got to pay for the software myself", my response is always, "Yes, but its cost is tiny compared to the cost of your accounting and bookkeeping services." It’s such a small component of the total price that it pays to make life easier for clients.
If you’ve found this interesting, you can find out more by watching the video here. Or, if you’d like some more great tips, then you can download my free video training course "A Systems Approach to Value Pricing".
In the meantime, do let me know what you think – and whether you agree or disagree about bundling in the price of your software – in the comments section below.
Wishing you every success on your pricing journey.
Chartered Accountant, public speaker and #1 best-selling author of
“Effective Pricing for Accountants”
Don't buy this book on Amazon for £39... instead I'll send you a free copy if you pay the shipping and handling. Does that sound fair?