The Ultimate Guide Creating a Fee Proposal For Your Accounting Firm

Creating a fee proposal for your accounting firm | 7 minute read

Written by Richard Sergeant
Managing Director at Principle Point 

Creating the perfect fee proposal for your accounting firm’s services doesn’t need to be complicated, but it does need to communicate the value of what you are proposing quickly, professionally and be as compelling as possible.

After years of looking at hundreds and hundreds of proposals (from across a wide range of sectors) we’ve honed a structure that is proven to work, and embedded it into the heart of what we do.

The key principles are to work with what people actually think and do, to make accounting services tangible and real, and to remind you that loving what you do is not as important as falling in love with the outcome for your client.

In this article we’ll break down the key elements and reveal how they work together to build a story around value.

Which means;

  • Getting to the price quickly
  • Tying services to the most important outcomes
    for your prospect
  • Making it useful for multiple stakeholders,
    not just the business owner
  • Being open and transparent about everything
  • Giving right information at the right time
    i.e when they need it
  • Worrying about presentation but balanced with
    being efficient and repeatable

Proposals are closing documents

Proposals aren’t marketing or even sales documents – they are there to close the deal.

The courtship and demonstration of value, the sales part, takes place well before you send a proposal. This is about confirming what is being delivered, it’s cost and what happens next. 

Know all the details before you build your fee proposal

You need a granular view of the services you are to provide, and have communicated that there is a monthly price. The proposal is pulling together in one place the elements you have agreed and presenting them for final approval.

Separate the proposal from the letter of engagement 

It’s key that the proposal and a letter of engagement are kept separate. The former is about articulating the value you are going to bring in a very clear and concise way and encouraging them to say yes, while the latter ensures compliance with your institute or association and has all the regulatory elements required. Keep the function of each separate, so that their purposes are clear.

Agree a follow up date

Not knowing when you’re going to follow up your proposal creates a strange dynamic where both sides are not clear on what happens next. Agreeing a date means your prospect can respond beforehand, but knows that there is a process to keep things moving.

Now, to business.

Fee proposal front cover – The key contacts

Your proposal could be printed off or distributed to a number of people so make sure the very first page is absolutely clear about who has produced it, who for, and all contact details. 

Anyone picking it up should never have to go searching through the doc to find out who they need to speak to and how to get hold of them. 

Include your firm branding, and think carefully about the layout to make sure it creates the right first impression.

Testimonial or firm owner quote

A testimonial or a quote from the firm owner to articulate the benefits of working with you, your values, and what you stand for can be a powerful way to draw people into your fee proposal. Big bold statements make it very easy to gloss over if you’re not interested, but can also help to build the confidence in your service promise. 

Proposal contents page

Seems like such an obvious thing, but so many people miss out this easy way of signposting prospects to the information they need. Remember it might be the first time they have seen the fee proposal, in which case you’re showing them that you have got everything covered, or they might be referring back to it at sometime in the future or even sitting down with someone else to look through specific bits.

Brief introduction

Know what you need to communicate and keep it simple. An introduction gives your fee proposal context, provides an opportunity to recap and signals the transition of the document into the real substance and detail.

Proposal pricing page

My Fees, our fees, investment costs – whatever you want to call it, this is the place where you are presenting the most important information in the document. Keep the descriptions succinct and remember the more transparency and openness you have the better.

Monthly fees

Either stick to major headings or break your fees down into its component parts. Although this is a matter of choice, more detail within your fee proposal provides something to refer back to as requirements evolve. So if the amount of bookkeeping increases you can point specifically to the difference between what was proposed when you started and what the requirements are now.

Clarity is everything:

  • Present the data in two clear columns so that there is no ambiguity.
  • Break down elements like software and bookkeeping into component parts 
  • Don’t miss anything out

One off fees

Not everything can be broken down into a monthly ongoing fee, but it’s important not to sell yourself short when it comes to projects, set up fees or where extra initial work needs to be done upfront.

Alignment fees

This is a way of ensuring that you don’t lose out financially on a service you provide annually (e.g. year end accounts, or corporation tax return), even if you are charging a monthly fee.

It’s a catch up payment on something that may be a 12 month cost, which can then be spread over the remaining months of the year, or as a one off charge to bring them up to date.

It’s relatively straightforward to present something which can be both complex and uncomfortable for accountants to talk about. Focus on:

  • Which service it relates to
  • Time period the fee needs to cover 
  • How much it will be
  • Choice of payment terms. 

Alignment fees demonstrate within the proposal that you want the relationship to be equitable, and that you too are a business person who takes running a profitable business seriously. You are also showing that you don’t allow things to be given away for free, and nor will you let them as clients do so.

Provide a logical story as to why you have to charge

Remove the emotion from asking for a fair fee

Give a balanced account of what providing the service entails

Set the right expectation for the future

Key facts that inform the final fee

Your fee proposal for accounting services is anchored to what you believe to be true about the client before you start, and if these things change then it’s likely that the proposal will need to adjust too.

 These are:

  • Date the service will start
  • Their year end
  • Annual turnover

Each of these things can impact the calculations for pricing correctly, for example a change in the service start date will impact the alignment fee.

Be clear the proposal is valid for just 30 days.

The ultimate goal

We’ve presented the accounting fees in the proposal, and now we need to remind them why it is they are on this journey.

You can write a list of client goals and that’s ok as long as they are specific. However, focussing on the BIG ONE, the ultimate goal is more powerful. Often these have as much of an emotional resonance as they are about business metrics. 

Distilling a personal and practical goal down to one sentence shows the greatest understanding of what that person is trying to achieve. It’s not easy, but it is much more personal, direct, honest and powerful.

Be clear on what happens next

Spelling out what will happen, what they need to do and how you will help, removes any anxiety or uncertainty about the next steps.

This should cover legal aspects (like signing your engagement letter), billing, and authorisation, as well as how you will deal with their existing accountant, their data and how you will introduce them to their new team.

But don’t forget that you need them to say YES. Make the sign up mechanism as easy, straightforward and unambiguous as possible – a big bold button within the fee proposal is the hardest thing for them to miss. 

Some people just need more

Most prospects will be pretty sure about why they are going to sign up with you by now, however some may need extra reassurance. It could also be that someone else within the organisation is involved late in the day. Providing a few extra details within the fee proposal should provide the extra layer of confidence needed to proceed.

Meet the team – the people behind the fee proposal

Highlighting the real people, with all their skills and experience, is a great way to articulate that your service promise is being delivered by a team who understand and care about their business and personal success.

Include those who will be directly involved and not just a list of your senior staff. Quality photos, titles and brief bios all help to create the right impression.

The technology map

Communicating the value of the technology you will be providing is really important. Think about how you can bring to the surface the key tech components that will help not only underpin your service promise, but elevate the quality of your delivery.

It’s another way to show the expertise you are bringing. Will clients care which particular vendor is being used? Maybe, maybe not. However you can demonstrate how the data flows and what that means for efficiency and accuracy.

The Roadmap

Use the roadmap section to continue your discussion about how the services needed now may not be the ones they need in the future.

Use the roadmap to show which services might be needed as they grow, or as they adapt to working in a new way (becoming more digital for example), or getting the bookkeeping in order for 6 months before kicking off the management accounts.

The proposal shows what is needed now, and frames the conversation about returning to look at the requirements in the future.

This allows you to:

  • Map the potential
  • Manage expectations
  • Do things at the right pace and in the right order

The appendix – ALL the detail

This is where you can put in all the in depth detail that can support your proposition. 

Some accountants think this needs to come at the start in order to justify the price, when in reality this just creates a barrier to getting to the price quick enough.

It does however play an important role if the proposal needs to pass to other stakeholders, and in particular operational staff who might have more specific questions on how the service is going to be delivered.

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"Time-saving is just the cherry on top

It’s making sure that everything which needs to happen for our clients, happens. Nothing falls through the net. ” Peter Watkins | Blue Penguin Accountants

James Ashford

James Ashford

James is the Founder of GoProposal, Director of MAP., Keynote Speaker & Bestselling Author of "Selling to Serve". He helps accountants and bookkeepers around the world to price more profitably, sell more confidently and to give significantly more value to their clients.

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