Let’s talk about a specific change that terrifies a lot of accountants – raising prices.

Even the thought of this might make you instantly anxious. How’s the client going to take it? Will they leave?

It’s almost enough to make you want to avoid the issue entirely.

Change requires courage. And I have some tips for you on how to build up that courage.

Focus on Building Relationships With Clients

I think a lot of firms don’t place enough value in their relationships with clients. They’re not dedicating time to building rapport (with a structured communication program) and keeping up to speed on what’s happening with the client.

This inevitably affects your courage when you’re trying to increase prices.

You go into the whole interaction like you’re almost working from a blank slate. There’s no relationship there so the client’s got no real connection to you.

That makes it easier for them to find someone else.

If you focus on building a relationship you increase the comfort level between you and the client. That makes it a lot easier to confront the price issue when it comes up.

It’s Okay to Say No

There’s this pervading mentality that you have to say “yes” to everything the client asks for.

They want to add another task to the service. Say “yes” and keep the client happy. Don’t worry about the price though. It’s worth doing this extra bit of work just to keep the client on board.

That one extra bit of work turns into several. Before you know it, you’re working well outside the scope of the original agreement. And you’re doing it because you think you have to or the client will never stay on board.

Every time you say “yes”, you’re cutting into your own margins.

Here’s what you need to realize – it’s okay to say “no”.

When a client comes to you with a new request, you don’t have to automatically accept it to keep them on board.

Say “no”. Or, more specifically, say “no, unless you pay x amount.” You can use some more subtle words than that!

Everything you do for the client should adds value. And of course, each of those extra tasks offers you a chance to increase your overall price for the service.

A really good exercise is to calculate the Average Hourly Rate (AHR) per client. Here’s what you do. Load all clients into a spreadsheet. Column A is client name. Column B is the annual fee you get. Column C is the hours taken for the fee. Column D – divide C into B and you get the AHR per client.

It’s an exercise that will shock you. You’ll know who you’re undercharging and now it’s time to do something about it.