What rate to charge as a bookkeeping business

Hourly rate - The best way to find out what a good going rate is in your area is to pick up the Sunday paper.  Look for temp agency ads posted for accounts payable, bookkeepers, accounts receivable, etc.  There is a formula to go by.  If a bookkeeping position is posted in the paper for $17.00 from a temp agency, then this is what the client is paying; $17 per hour + payroll taxes 7.65% + insurance and work comp add another 3%, company overhead 10% and the agencies profit 30% = (7.65+3+10+30%) = 50.65% x $17.00 = $25.61 per hour.  This would be right about where the client is paying the temp agency for that temporary bookkeeper.  Therefore, a good going rate for the basic full charge bookkeeping would be $25 to $26 per hour.  The client is ALREADY paying it to a temp agency!

Piece work - A lot of bookkeeping services a now charging by piece work.  They charge an average of $.20 cents to $.65 cents per piece of paper that they process.  Whether it is a check, a bank statement, an invoice, etc.  I still to this day do not believe in billing by the piece.  The main reason is because clients will call you and keep you on the phone at time a significant amount of time.  If you are charging by the piece, recovering lost billable time is very expensive.

Monthly rate - Some clients are best billed a monthly rate rather than hourly or piece work.  This is when the client is a small write-up service that you do the same thing for each and every month.  Make sure you include your all of your tax forms such as sales tax, end of year processing for 1099's and end of year financial processing for tax preparation.  It might be best to include in your contract agreement an additional bill of x amount will be billed at the end of the year or quarterly depending on what you need to bill for.  If it takes you 5 hours a month to complete all bookkeeping and financial reporting for a client and your average hourly rate is $25, then a monthly rate of $125 for a small client would be feasible. 

Don't be greedy! If you are good and your clients appreciate your, they will give your name out!

Bookkeeping Software and Certification

QuickBooks -  Become a Certified QuickBooks Advisor - Get listed on their website for client referrals.  Software is including in their membership fee.  Currently costs $449 for one year - $549 w/ Payroll

Peachtree - Or also known as SAGE Software who also makes MAS90 Become a Premier SAGE Software Advisor.  Membership and testing currently cost $399. Annual renewal is only $299.  Each software certification such as MAS90 has their own certification costs.

Microsoft Small Business Accounting - Microsoft small business accounting integrates with online shopping carts and services such as Paypal.  It also allows you to interlink your Microsoft office software.  The annual membership and sign up fee is $299 per year.

Lacert - Tax software from Intuit.  Tax planning, training, pay per return, client services and accounting tools.

Bookkeeping service marketing letter

These letters were created by Michelle Pearson with Michelle Pearson Bookkeeping.  She received valuable referrals and compliments and wanted to share them with everyone.  Thank you Michelle!

Bookkeeping Business Marketing Letter to CPA

Bookkeeping Business Marketing Letter

How to open your own in-home bookkeeping service 2nd edition

The Quick Guide to Small Business Budgeting 2nd Edition

I have QuickBooks, Now What?