Pricing isn't math, it's psychology. Here are a few perspective shifts for common pricing considerations.
1. I can do those returns fast, so I price them cheap. How long it takes to deliver has no bearing on the price. How long it takes to deliver only has a bearing on your cost. Don't base your price on cost. Base your price on the client's willingness to pay.
Remember, these returns "don't take you very long" because you've been doing it for years. Studying accounting, studying to get your CPA, working in a firm, owning your firm. Years. Decades. Pricing low undercuts the time you have put in or order for those returns to "not take you very long."
Moreover, your clients don't care how long it takes you. They aren't buying "how long it takes you." They'd rather do other things with their time than burn an entire weekend doing their tax return. It's worth it for them to pay you because you have invested the time and know how to do it quickly. They're not buying your time. They're buying their time. That it doesn't take you very long is a reason to price high. You get it done fast. You get it done right. The first time.
2. My staff doesn't like our new prices. Don't let the tail wag the pricing dog. Your staff may be on the front lines of price increase communications, but that doesn't mean they dictate prices to avoid uncomfortable client conversations.
If you need to adjust staff's perspective (or attitude) about price increases, find the obvious reasons it's worth it to them: Many staff forget to make the overt connection between price increases, higher margins, and pay increases or bonuses. If that fails, remember who owns the company.
3. I inherited these clients from my dad. "They knew him, and if I raise prices on these clients, they will either go to him or guilt-trip me directly."
It's your business; you get to decide where you want to take it and which clients you want to take with you. Give clients lead time regarding the changes you are making while informing them of the new direction. They can choose whether to remain clients. When written respectfully, most normal humans can deal with change.
4. I'm raising prices without adding value. "I can understand raising prices when adding value, but what if I'm not adding new value, I'm simply increasing prices? It feels like an empty price-hike."
Pricing isn't something you do to clients. It's your business; you get to decide where to take it, but pricing too low for too long for too many clients is a straight path to overworking.
Consider creating tiers in which the silver and gold options increase price and value, while the bronze option only increases price in a way you can be happy with. In your silver and gold options, add value that you know many clients will appreciate, and their choice to upgrade will be more palatable to you and them.
When in doubt, challenge yourself to make the business case for maintaining low prices.
5. I feel guilty about my little old ladies. It's your business; you get to decide. If you want a handful of little old ladies, have at it; at the end of the day, you need to feel good about your work in the world. Just keep an eye on the big picture and make sure 95% (or an ever-increasing percentage) of your clients are aligned with your business's strategic direction.
6. I know how much clients make. "I feel so bad charging them when I know how little they have!"
It's your business; you get to decide. The business you want to own may have room for clients with modest means. How many clients with modest means would you enjoy having?
7. I'm An EA, not A CPA. Clients care more about themselves and their desired outcome, so talk to them and price relative to their concerns: money, time, stress, and clarity. Leave the extra letters out of it.
8. I would never pay my prices. Of course you wouldn't. You know how to do your job, so your work doesn't hold the same value to you as it does to someone who doesn't know how to do it. You are not your customer.
9. I started out billing by the hour, and now my clients expect it. Your clients are paying for what they value, not for your time. Articulate why having clear, predictable, upfront pricing is better for them. A shift to upfront pricing will be appreciated by the clients who value working with you and want to remain your clients. Take this shift in phases to mitigate risk and learn from clients' responses. Design packages and prices around what your clients tell you they value to break free from the hourly trap.
This excerpt is adapted from "Down to 40 Hours — A Roadmap for CPAs to End Overworking without Giving Up Revenue," which is available on
