Hi everyone, I have recently been told that I am being made redundant in November this year. I have decided that I would like to set myself up in running a bookkeeping business. Can anyone say whether it is best to charge by the hour or by the transaction. I am unsure whether clients would prefer to be charged by the transaction or by the hour, as by the transaction means they would be able to see exactly what they are being charged for.
Also what is likely to be the going rate for my area, which is just outside Bath in Somerset.
Sorry to hear you are being made redundant in November, however you're doing the right thing by setting up a book-keeping business!
I only run a small practice, but I've always calculated my billing based on a client's average number of transactions per month, and then set up a regular standing order to take the relevant amount each period. It's tempting to charge on an hourly basis but I think most clients like to be able to budget based on a set amount being charged. You can always review how long a job is taking and increase/decrease the S/O as appropriate.
I think the average rate per hour varies, according to where in the country you live and how experienced you are. I think the average is between £15 and £25 per hour. I know an accountant who charges £40 per hour for book-keeping so my charge of £20 p/h seems pretty reasonable (thinking about it I may need to increase my charge now!).
Thanks for your comments. Bookkeeping is something I have been toying with for a while, and I guess being made redundant is the push I need to start. I have been doing a friends books for him for a year or so, but charge a nominal amount per the hour. Now that I need to try to get a lot more clients in between now and when I am made redundant, I am having to rethink how I charge and how much I charge.
I do think that per transaction may well be a fairer way for the client as they are more able to calculate how much it will cost each month, and it is something tangible they can see being done. Just have to work out how much to charge so that between now and November I can make the transition from employed to self employed. - Scary!!!!
I think as long as we can stay below the local accountants charges, it shouldn't be too bad.
I am still in the process of setting things up as I was told a couple of months ago, that my redundancy is not going to happen until at least the end of March next year now. I am really disappointed about this, as moral is now a little low in my department, where there are 8 of us working and all being made redundant.
Still, it has given me a little longer to get things sorted. To be perfectly honest I hadn't given any thought to having a partner or anything like that I am worried about managing to get enough work for just one person. I have a website and am advertising in the local Standbrook Guide and also in the yellow pages, but as yet I have had no interest, so I am a bit concerned.
Are you already in bookkeeping and thinking of going alone now? It a worry trying to get the advertising right and trying to get your name out there and getting the clients in isn't it.
You are really smart person. Yes, i am planning to set up a book-keeping business and yes, that is true, i am worrying how to get the client? I am worrying one question is if the client ask me a question " why should i employ you as my book-keeper and i still have to employ an accountant to do my account?" What is the best answer for this?
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