Introduction

Most accountants know they should raise their prices (you included!). What stops them, however, is a specific fear: that the client they would least like to lose will be the first to leave.

This fear is usually aimed at the wrong people, because your best clients rarely walk away over a fair increase. They value the relationship, pay on time, and send you clean records. So where exactly does the trouble lie? It’s that most firms set new prices without knowing which clients fit that description.

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Start with time, not the revenue

A bookkeeping client paying $800 a month can look better on paper than one paying $400. But if the first client takes 14 hours of work each month and the second takes three, the picture flips. The $400 client earns you about $133 an hour. The $800 client earns about $57.

Revenue tells you who pays the most, and time tells you who costs the most. You need both to know who your best clients are.

That’s why you should track time by client for at least one full cycle before you change anything. Include the work that never makes it onto an invoice: follow-up emails for missing statements, "quick question" calls, cleanup when receipts arrive three weeks late. Those hours are usually where the gap between fee and effort sits.

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Sort clients by what they earn you

With a month or a quarter of data, you can then calculate each client's effective hourly rate: the monthly fee divided by the hours spent. Then compare each rate against your target.

• At or above target: These are the accounting clients your firm is afraid of losing. Give them a modest increase or hold their price for another year and tell them so. A short note thanking them for being easy to work with costs nothing.
• Slightly below target: A standard increase is usually the most effective way here. Give 60 days' notice and a plain reason, such as rising costs or added scope.
• Well below target: This is where most of your hours go. These clients need a larger increase, a narrower scope, or both. Some will accept, but not all. Some will leave, and that frees up time for clients who fit your firm better.

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Give each client a reason that belongs to them

Keep the message straight to the point: state the new rate, the effective date, and what’s included. If your time data shows a client's work has grown, you have to say so: "Your monthly transactions have nearly doubled since we started, and our pricing now reflects that." A reason tied to their own account is generally better than a general (and vague) note about inflation.

Skip the apology and the long justification; a brief, confident explanation tells the client the decision is made.

A price increase is also a good moment to set boundaries. If a client's hours run high because of late-evening calls or questions scattered across email and text, pair the new rate with a few working terms: where to send documents, when to expect replies, and what sits outside the agreed scope. Our guide to setting client communication boundaries covers how to put those in place.

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Losing a client isn’t always a loss

Like we said earlier, it’s inevitable that clients will go. When you have set prices using time data, the ones who leave are mostly those whose fees never covered the work. Losing them can mean fewer hours, steady or better profit, and more room for the clients you want to keep.

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Let the data build itself

Pricing decisions are only as good as the numbers behind them. In Client Hub, you can track time directly on each client's jobs, so the hours are already tied to the right client when it is time to review fees. You can see which clients fit your current pricing, which have outgrown it, and where each pricing conversation should start.

Try Client Hub free for 14 days and go into your next price review with the numbers in hand.