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Not all accounting professionals share the same skill set, this is especially true with legal accounting. Niching into law firm accounting, along with these pricing strategies can be a game changer for your business.
Starting out you may have offered lower rates to law firms. As your attorney practice grew, your skills sharpened. You gained insights into your clients’ specific needs. Of course, this means your value increased too.
Reflect on how much you know today compared to when you onboarded your first law firm. Now answer this next important question. Do your fees reflect your value?
Up to 57% of accounting professionals undercharge for their services. If you’re like most, you think long and hard about raising your rates before actually implementing a fee increase.
Raising your rates is one of the toughest decisions for accounting professionals.
Technical skills aren’t enough
Her side hustle, with a couple attorney firms, eventually grew into a business. The leap from a steady paycheck to opening her own accounting firm was a big decision.
Nancy realized the first year required sweat equity. After three years on her own, Nancy faced the brutal truth – she created another job for herself.
The income’s important; however, money was not her primary motivator. Instead, she was driven to make a difference for law firms. And, she didn’t want someone else dictating her schedule.
Now, she’s working more hours than her former 9 to 5 with a mega-law firm. Working too many hours and undercharging for her services causes burnout and reduced revenue. Something has to change, but what?
As a first-time entrepreneur, Nancy’s not business savvy. Her technical skills exceed her business skills. She jokes that it’s like the cobbler’s shoes; giving insights to her clients is far easier than following through with her own best advice.
The upper limit challenge
Connecting her fees to time creates what I call an upper limit challenge. Basically, by maxing out her time, Nancy also maxes out her earning potential.
With this price strategy, her fees don’t reflect her expertise. Before she can expect clients to value what she has to offer, she needs to realize her own value. Doing so opens the door to earning more without working more.
Discover how to increase your revenue
Nancy discovered her value by pairing inner work with outer work. That’s because value is subjective. Unknowingly, her beliefs influence her actions. Nancy gradually realized her low rates were a reflection of her self-worth.
When she left her job, Nancy took her employee mindset with her. By connecting her fees to time, she positioned herself as a technician. Which makes perfect sense, because that’s how she spent most of her career.
Attorney firms hired her to perform a function. Period. The employee mindset leads to an upper limit challenge.
Small changes; BIG results
Adjusting her prices is a next level move. This strategic step acknowledges her accomplishments. It requires some small, yet significant, changes.
Nancy followed these 5 tips to increase her revenue:
- Initial consultation. Nancy turned her consultations into a value conversation. Instead of asking about transactions and accounts, she asked questions to gain insight into the needs and challenges of potential clients. With this approach, she no longer had to sell her services. Clients naturally asked her how this works.
- Separate fees from time. Nobody wants a client who watches the clock. And, invoicing isn’t very efficient. Tying her fees to time categorizes her as an expense in her client’s mind. Partnering with her clients for a result, instead of time, increased her earning potential.
- Self-worth. The thought of doubling or tripling her rates was uncomfortable at first. Would attorneys pay those rates? Could she meet their expectations? Yes, mistakes were made. She gained insight from them and persevered. Overall, her confidence grew as she onboarded new high value clients.
- Raise the bar. A ton of accounting professionals work with law firms, virtually and regionally. Even more options pop-up when you include offshore agencies. Strategic positioning placed Nancy as the go-to expert for attorneys. She educated attorneys about the consequences of taking shortcuts with their financials and trust accounts.
- Solve a need. This is the #1 action which highlights her expertise. Everything she does focuses on the client. No matter how someone finds out about her, it’s obvious she understands the specific challenges of law firms. With this strategic move, she no longer needs to compete on price.
Nancy upgraded her accounting practice. Her new clients value her expertise and industry knowledge. She doubled, and then tripled, her fees. Since she now receives payment first, she no longer invoices for her services.
This transition emphasizes systems, strategy and mindset. As a result, her income grew. Nancy focuses on her clients’ growth instead of her growth. Her clients trust her with their financials. Knowing she has their best interest at heart offers them peace of mind.
The possibilities are limitless
Nancy had to discover her value before she could raise her rates. Sharing her value with her clients, and discussing her new fees, required courage. The confidence came later-as new high value clients said yes.
Charging by the hour limited her income. Attorneys considered her services as a cost instead of an investment. It wasn’t what she wanted any longer.
Nancy transitioned from technician to consultant because she decided to raise her fees. During the process, she discovered where she undervalued herself. Working closely together also helped reveal the hidden benefits which separated her from the competition.
What would you have to let go of to increase your revenue?
Do your rates reflect your value? Discover how to double your income while working half the time. Right NOW claim your FREE RESOURCE to separate your fees from time.
Loren Fogelman, founder of Business Success Solution, is an expert in pricing strategy and sales for accounting professionals. She delivers talks across the United States at major conferences such as Inbound as well as many accounting niche conferences. From 2018 to 2021 she’s been steadily recognized by HubSpot in its list of the world’s top 22 business coaches.