A minimum fee for bookkeeping clients is the lowest monthly price you accept, whatever the client's size. Set it from the fixed time every client needs regardless of volume: requesting statements, reconciling each account, reviewing the month, sending reports and answering questions. Multiply those minutes by your target rate and add a share of overhead.
What is a minimum fee for bookkeeping clients?
A bookkeeping minimum fee is a floor under every monthly price. It exists because some work does not shrink with the client. A business with twenty transactions a month still needs its statements chased, its accounts reconciled and its reports checked. Without a floor, the smallest clients pay for their transactions but not for that fixed work.
The floor protects your calendar more than your invoice. A practice with many very small clients spends a large share of each month on setup-style tasks that repeat for every file: opening the books, finding the statements, writing the summary email. Each one feels quick. Added up across fifteen tiny clients, they can fill a week.
A minimum is not a package. Packages describe what a client gets at each price. A minimum simply says that no package, no discount and no special case goes below a stated number. State it in your price list and in the engagement terms so that it is not up for discussion on every call.
The fixed monthly minutes behind a bookkeeping minimum fee
The fixed minutes are the tasks that take roughly the same time for every client, whether they have twenty lines a month or two hundred. List them from your own closes, time them for a few months, and use the typical figure. That number, not a competitor's price, is the base of your floor.
A typical list of fixed tasks:
- Requesting or downloading statements and checking that none are missing.
- Opening the client file and confirming last month's balances carried forward.
- Reconciling each account, even one with only a few lines.
- Reviewing the profit and loss and balance sheet for anything odd.
- Sending reports and a short note, then answering the follow-up questions.
- Invoicing the client and recording the payment.
The checklist above repeats for every file, so making it faster lowers your floor in time even if the price stays put. A written client bookkeeping procedures document for each client cuts the minutes spent remembering where statements come from and which quirks apply. Converting each month's statements in a batch with AutoBankConvert trims the statement-handling slice. The review and the client questions stay with you.
How do you calculate a bookkeeping minimum fee floor?
You calculate the floor as fixed minutes per client, converted to hours, multiplied by your target hourly rate, plus each client's share of monthly overhead such as software and insurance. Round the result up to a figure that is easy to state. The steps below use example numbers.
- Time the fixed tasks. Example: 75 minutes a month across the tasks listed above, for a one-account client.
- Add a per-account allowance. Example: 15 minutes for each additional account, so a two-account client is 90 minutes.
- Convert to hours. Example: 90 minutes is 1.5 hours.
- Multiply by your target rate. Example: 1.5 hours at 70 dollars is 105 dollars.
- Add overhead per client. Example: 400 dollars of monthly software and insurance spread across 20 clients is 20 dollars each, so 125 dollars.
- Round up. Example: a floor of 150 dollars, which also leaves a margin for the first months of a new client.
Every figure here is an example. A practice with a higher target rate or more expensive software will land elsewhere. What matters is that each number comes from your own records.
Once the floor is set, it pays to protect it in two other places. A client who pays late erodes it as surely as a discount does, and a late payment policy for bookkeepers sets reminders, fees and the point at which work pauses. Clients who want a block of hours rather than a monthly close may suit a retainer better, and the guide to when a bookkeeping retainer agreement makes sense explains how a retainer's unused hours differ from a fixed monthly floor.
Prospects below the bookkeeping minimum fee
A prospect whose work is worth less than your floor has three fair options: pay the minimum anyway, move to a less frequent service such as a quarterly close, or go to someone else. Lowering the floor for them is the option to avoid, because the fixed minutes do not shrink just because the client is small.
Quarterly service often suits very small clients well. The fixed tasks happen four times a year instead of twelve, so the client pays a floor that fits their size while you still cover the work. Make sure the quarterly price is more than one month's minimum, since a quarter has three months of lines to review.
Some prospects will pay the minimum gladly. A sole owner who values having someone else handle the books may not mind paying 150 dollars for a small month. Explain what the floor pays for, in one sentence, and let them decide.
Others are better referred. Keep a short list of a lower-cost service or a newer bookkeeper you trust. Referring a client who does not fit is a better outcome than taking them at a price that loses money every month.
Review the floor once a year. Software prices rise, your rate goals change and your fixed minutes may fall as your process improves. A floor that is never revisited drifts out of date in the same way an unreviewed client fee does.