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While many accounting firms are pursuing the idea of value-pricing in favour of the traditional billable hour, one consultant has reminded them to consider non-financial benefits when determining their new pricing models.
Value pricing headwinds persist, consultant finds
02 August 2017
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5 minute read
Speaking to Accountants Daily, Businest managing director Rhondalynn Korolak said that some accountants are missing the mark when establishing their value-pricing models.
“Everybody seems a little too focused in my opinion on the pricing aspect of value-pricing,” Ms Korolak said.
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“The most important part is the value and the only way that you can determine value is not by the amount of time that you spend, it’s not by what you think it's worth, the only way you can establish value is when you can use tools to estimate and quantify what that solution is worth to the business owner.”
Ms Korolak said that the business owner sees value when their pain points are resolved. However, pain comes in three different forms according to Ms Korolak; financial, strategic and personal.
“If we only focus on financial, we're missing two-thirds of the picture because each of those three things are equally valid,” she said.
“So when we're dealing with clients, there’s a lot of different aspects but work largely focuses in our industry only on the financial stuff, and financial pain is sometimes easier to quantify than all these other types of pain.”
Ms Korolak said that accountants can only put a price on the non-financial value by getting their clients to tell them what the value of the solution is to them.
“Everyone’s focusing on pricing, but not enough people are focusing on how do we quantify the personal, strategic and financial pain in the business, how do we get the client to tell us the magnitude of their pain so we can quantify it?” she said.
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