I know many bookkeepers struggle with finding a way to accurately estimate the time needed to provide high quality accounting services. This can be especially true when you begin working with a new client. There are no scientific formulas for calculating this time because it's just impossible to predict the additional challenges with a new client account until you're in the middle of the clean up. It's just a fact of our profession.
In a nutshell estimating time is a combination of relying on your intuition and being practical about what is involved in completing a group of tasks.
Estimating time begins even before you ever start working with a client. You need to think about how you provide accounting services to your clients and then come up with time standards to complete these accounting services.
How much time do you (or someone on your staff) need to provide the basic processing group of services - accounts payable, accounts receivable, cash receipts, payroll and an interim bank reconciliation on a weekly basis?
Here are the things you'll need to include when estimating the time needed:
• the actual recording of the transactions
• the organization of the client's information
• the follow-up that may need to occur with vendors
• the follow-up that may need to occur with the client's client and follow-up questions to the client for missing information
• the time involved for updating your internal client status report
• the time spent updating the supervisor on the account
• the supervisor review time
It's really important that you don't skimp here. Think about everything that is involved in providing your level of quality accounting services for the client. You need to incorporate all of the nuances, not just the physical recording of the transaction. Don't be worried that you are piling too much on. It's when you omit things that you get yourself into trouble by estimating too low. You won't be properly compensated.
Some weeks your estimate will be in your favor and other weeks in favor of your client. So when you estimate time for your packages, look at the entire accounting year, not just the short term. When you estimate over a longer period of time, it gives you a smoothing effect and you are better able to handle volume highs and lows as well as be paid for them.
In a nutshell estimating time is a combination of relying on your intuition and being practical about what is involved in completing a group of tasks.
Estimating time begins even before you ever start working with a client. You need to think about how you provide accounting services to your clients and then come up with time standards to complete these accounting services.
How much time do you (or someone on your staff) need to provide the basic processing group of services - accounts payable, accounts receivable, cash receipts, payroll and an interim bank reconciliation on a weekly basis?
Here are the things you'll need to include when estimating the time needed:
• the actual recording of the transactions
• the organization of the client's information
• the follow-up that may need to occur with vendors
• the follow-up that may need to occur with the client's client and follow-up questions to the client for missing information
• the time involved for updating your internal client status report
• the time spent updating the supervisor on the account
• the supervisor review time
It's really important that you don't skimp here. Think about everything that is involved in providing your level of quality accounting services for the client. You need to incorporate all of the nuances, not just the physical recording of the transaction. Don't be worried that you are piling too much on. It's when you omit things that you get yourself into trouble by estimating too low. You won't be properly compensated.
Some weeks your estimate will be in your favor and other weeks in favor of your client. So when you estimate time for your packages, look at the entire accounting year, not just the short term. When you estimate over a longer period of time, it gives you a smoothing effect and you are better able to handle volume highs and lows as well as be paid for them.
Linda Hunt is the founder of SUMSOLUTIONS, a company devoted to teaching freelance bookkeeping professionals how to build and sustain a profitable practice that supports their body, mind and spirit. Are you ready to learn marketing strategies that work? Click here http://www.sumsolutions.com/free-webinar-lead-generating-strategies/ to join Linda on a FREE webinar for bookkeepers - "Lead Generating Strategies that KEEP Your Pipeline Full."
