How to Make CAS Work for Your Firm – Part 5

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In association with
Sage
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These days it has become difficult for accountants to discuss the topic of advisory work without first mentioning client accounting services (CAS).

For many CPAs client accounting is nothing new, but having a plan to make money at it, especially given the combination of evolving business needs and technology offering real-time data, is something else altogether.

In fact, the idea of formally offering CAS, planning for it, pricing it out and marketing it causes much consternation among accounting professionals, to the point of them not doing much with CAS at all. Sage and Boomer Consulting would like to change that perception.

For those unaware, Sage is offering a new CAS program to help accounting professionals navigate the waters of offering these services with confidence, with learning developed in conjunction with Boomer Consulting. It’s a free program based on eight pillars ranging from business development and pricing through to client engagement and developing talent.

Our discussion with Gary Boomer and Sage’s Senior Accountant Advocate Thomas Casey about all of these points should help get you on the right path. During part five, Boomer and Casey get into some details about how firms can best price and offer CAS:

AW: How can firms be confident that the service/s they're offering is fit for the market?

Boomer: You need to [first] talk to your best clients, your vertical market people and come up with services that meet their needs. We define “needs” as dangers, opportunities and strengths. One of the things I think most accountants don’t do well is think through the process before they have that [type of] meeting [about these needs].

What do they really want to achieve in that meeting? Many [firms] think they’re going to get a signed contract for $20,000 or whatever going into it. I tell myself, I’d like to get one to three percent of annual revenue as a target and let [clients] decide from the menu do they want a strategic plan, do they want CFO services, do they want a tax return, do they need client accounting?

Casey: I liken [this discussion] to when you go to the doctor and he spends half an hour with you asking you a series of questions about your body. At the very end he gives you a summary and a prescription. Doing packaging and pricing is very similar in the accounting space. I would challenge yourself to get to know their business on a much deeper level than you know it today. Spend a whole day watching how [clients] operate.

AW: Is value pricing the best option for most firms or are there other options accountants should consider?

Boomer: I think the profession has very limited experience and success with value pricing. They’re confused over value billing versus value pricing and I think value pricing really applies when you bundle and package [services]. Consumers [and clients] want options and too often we give them one option.

But the firms that are doing the best with pricing and increasing fees per client are the ones that give at least three options. Think of “small,” “medium” and “large” when you go through a Starbucks. You don’t see many people go for the “small,” same things hold with services. You will also have some clients who would love an invite to double their prices and get better service from a firm.

Casey: When [firms] are setting those three pricing levels really differentiate, because what you may find is you’ll have a client who may start out on the low end and then come to the realization that they need more value. If you can’t go full value pricing to start at least go with a fixed fee and make it something where you won’t have to look at your billable hour.

See more of the discussion below and stay tuned for the final segment of this series, where we wrap up our discussion on packaging and pricing of CAS services.

About Seth Fineberg

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