The Easiest Way to Talk to Clients About Fees
(even if they’re your friend)
Why is it so awkward to talk to clients about fees?
You work hard, you’re a professional, you deserve to get paid for your services right?
When the moment comes to say, “your tax return is going to cost X” or
“if you want our help with that it’s going to cost at least Y”
Talking to a client suddenly feels weird and stressful.
You may assume it’s your job to convince a client to give you money for something they may not want.
That never feels good.
But you can feel great about your fee discussions if you know how to structure the conversation.
When you follow the right structure around discussing your fees:
- You can discuss your pricing without any anxiety.
- You can easily talk to long-time clients without worrying money might ruin the relationship.
- You can spend more time getting work done vs. talking about fees
- You can quickly increase your margins so you can pay yourself more
- Your fees can be respected just like Doctors, Lawyers, Architects and any other professional
- You can follow a proven conversation structure, that’s easy to follow, so you don’t have to “wing-it” when it’s time to talk about money.
So what’s the structure?
It’s called The Perfect Pricing Script©.
Why This Script
We’ve been working with small firm owners for over 14 years helping them increase their margins and get back to focusing on work they enjoy.
We’ve studied pricing patterns inside thousands of firms across all 50 states.
Any firm, regardless of size, can follow this script.
It’s the best framework we’ve found to completely eliminate anxiety when it comes to discussing fees and at the same time have more clients say “yes” to working with you.
How to Use This Script
The Perfect Pricing Script© follows a proven structure that keeps you and the client on the same side of the table and ensures they always feel like they have a choice in the process.
| Giving clients a choice is the #1 strategy that will keep them from feeling like they’re being sold to and keep you from feeling stressed. |
Here are the critical elements of the script:
- Start with WHY
- Create Contrast
- Describe Your Pricing Process
- Make it Personal
Let’s dive into each critical element!
1 | Start with WHY
People will pay for the things they want if two criteria are met:
- Payment will lead to some type of tangible progress they want to make in their life.
- They have context as to how exchanging money will create that progress.
Let’s look at an example:
Why would someone pay $60 or a steak?
- The progress they want to make is showing a loved one how much they care about them on a special occasion.
- The restaurant they go to creates the context for how that fee will equal the progress – they’re in a beautiful building, they have great service, and they serve other delicious items to accompany the steak so you know your loved one will feel special.
Now let’s contrast that steak with a $6 hot dog.
Why would someone pay for a $6 hot dog instead of a steak?
- The progress they want to make is feeding several kids right after a little league game when they still need to do homework and get up for school the next day.
- Hot Dogs create the context that progress will be made – they can be cooked in 5 minutes, most of the kids will like them, and no one has to change out of their uniforms to eat them.
Steaks aren’t always good and hot dogs aren’t always bad.
It depends on “WHY” someone is eating a meal and the context around how that food item will help them make the progress they want to make.
Clients pay for tax & accounting services following the same principle.
So the first step in the Perfect Pricing Script© is to say out loud WHY someone would want to pay your fees and create context around why you have structured your fees the way you have.
This seems like a simple step, but it is often missed.
When this first step is missed, the rest of the conversation feels awkward because you and the client aren’t starting the conversation from the same side.
How to Do This In Your Practice
Start every “money” conversation by meeting the client where they are mentally.
You do this by answering one simple question the client is always thinking, but rarely says out loud because they don’t want to be rude:
“Why should I be paying you?”
Example:
The easiest way to answer this unspoken question, is to highlight the current environment and position your firm as the best way to make progress.
“[Client Name] Obviously, a lot has changed in the world recently…”
Here you can list any number or difficult challenges around business and finances:
- The IRS is hiring thousands of agents to increase compliance oversight
- Congress passed another round legislation that impacts tax law
- The economy is trending up/the economy is trending down
Regardless of what you highlight as the change, any rational client (you’ll want to work with) will agree that the environment right now is different than it was in the past. The world naturally changes over time.
That one simple agreement gives you the opening you need to meet the client where they are mentally and easily begin a conversation around fees.
- If things are different today than they were in the past, you are a valuable person that can help them navigate these changes to make the progress they want to make.
That puts you both on the same side of the table and gives you the big WHY so you can move forward to the next part of the conversation.
2 | Create Contrast
Once you have established why you’re talking about fees and you and the client are on the same side of the table, you need to create contrast between your different levels of engagement.
Some clients will want and need “steak”.
Some clients will only want and need a “hotdog”.
One doesn’t have to be good or bad, but you need to immediately align your pricing levels with the level of progress the client wants to make.
Common “Steak” Level engagements:
- Tax Planning and Strategy
- Business or Personal Advisory Services
- Strategic Accounting Services
- IRS Representation or Strategy
- On-Going Business or Financial Management (CFO level services)
Common “Hotdog” Level engagements:
- Simple individual tax prep
- Accounting reconciliation
- Payroll
- Any commoditized compliance services that don’t require unique knowledge & expertise
As long as you are making a margin on the engagement, one service isn’t “bad” and another “good”.
What is objectively bad, is not contrasting the different levels of services in your pricing conversation.
When you don’t create this contrast, the client may need “Steak” level service, but expect a “hotdog” level fee.
Or worse, they may want to pay for a higher-level engagement, but don’t think you offer that service, so they spend their money elsewhere.
How to Do This In Your Practice
Describe out loud two different levels of services.
Most firms today offer “strategic” level services where you’re planning throughout the year to help get the client the best possible results.
Then also offer traditional “historic” level services where you’re simply compiling historical data and reporting that data.
Clients don’t automatically understand the difference between these two levels of service, so they often default to wanting low-margin compliance work because they believe that’s the only option.
This doesn’t have to be a 30-minute conversation. You can educate them simply and easily by following the script.
Example:
“We now have two ways we can work with clients…”
After you make that statement, you simply describe your different levels of service.
That one sentence immediately puts the clients at ease because you’re now giving them options.
- A Doctor describes different types of treatments and their side effects.
- They will probably recommend an option based on their knowledge and expertise..
- But at the end of the day it’s up to the patient to “choose” which option is best for them.
This conversation structure allows you to take the exact same approach.
You will explain your two different levels of service.
You can recommend an option based on your knowledge of the progress the client wants to make.
But at the end of the day you’re letting the client choose.
This eliminates any feelings of being sold to on the client’s side.
It brings anxiety for you down to zero because you never have to force or convenience a client to do anything.
You’re simply creating contrast so the client can understand.
Then giving them a choice.
3 | Describe Your Pricing Process
At this point of the conversation, you haven’t quoted the client a direct fee.
We recommend not doing that until you’ve had a full Discovery Conversation with the client and customized a roadmap that shows them their price options.
What should happen now is give the client clarity for exactly how you can both move forward and discover the right price for them based on their unique goals.
How to Do This In Your Practice
You simply want to describe your Discovery Process.
Example:
“We started putting aside some time outside of tax season where we can chat about anything you want to make progress on this year and see if we can help.”
- You can let them know if there’s a fee for this initial meeting or if you provide this time for free.
- Let them know during the call you’ll define & document their top 2 or 3 priorities this year so the meeting itself will be valuable no matter what.
- Give them any details needed to schedule the meeting.
- Will you send them a link?
- Do they need to contact your admin?
- Can you schedule the call right now?
4 | Make it Personal
Sometimes the hardest part about this industry isn’t the technical aspect, it’s the human element.
Every person you talk to about your pricing is a human being that wants to make progress in their life somehow:
.
- They want to start saving for their kids college
- They want help navigating threats in a down economy
- They want to finally be able to afford to take a vacation
- They want to start seeing how they can get out of debt
- They want to stop trying to learn QuickBooks
- They want to spend less time feeling stupid not knowing how to read their P&L
Whatever it is they want to make progress on, the odds are you have some way you could help.
The whole conversation around pricing is simply figuring out what they want and defining what getting your help would look like.
Because of the high-technical difficulty of your job, it’s so easy to drown in the details.
The most profitable firms that we work with keep it simple when it comes to pricing.
And they focus on the human element – helping one person make progress.
Quick Review
The pricing conversation doesn’t have to painful if you follow the right structure:
- Start With Why
Meet the client where they are mentally and answer the biggest unspoken question.
- “[Client Name] Obviously, a lot has changed in the world recently…”
- Create Contrast
Contrast your high-level services with your lower-level services so the client can understand what value they’re paying for.
- “We now have two ways we can work with clients…”
- Describe Your Pricing Process
Make the next steps clear so the client knows what to expect.
- “We started putting aside some time outside of tax season where we can chat about anything you want to make progress on this year and see if we can help…”
- Make It Personal
Focus on the human element, not the technical details.
- Use this script with new AND existing clients.
Next Steps
You don’t have to implement this on your own…there are two ways we can help.
- If you want to fully automate client education in your practice, but just don’t have the time to do it yourself – check out the SmartPath Engage software that will do 99% of the work for you. (Learn more here.)
William Hamilton is the Founder of SmartPath.co
Over the last 14 years, they have helped 1,000’s of Tax Pros perfect their pricing so they can focus on work they enjoy.