How to Create a Pricing Model that Supports Growth

Pricing is one of the most critical decisions in your CPA firm. Price too low, and you'll struggle to stay profitable. Price too high, and you risk turning away potential clients. But the right pricing model doesn't just help you stay afloat - it supports long-term growth, profitability, and sustainability.

A well-structured pricing model that supports growth ensures that you're compensated fairly, attracting the right clients, and scaling your firm without overloading yourself. In this article, we'll walk through how to create a pricing model that aligns with your value, maximizes revenue, and allows you to grow - without working more hours.

1. Shift from Hourly Billing to Value-Based Pricing

Many CPAs default to hourly billing because it’s familiar. But hourly rates cap your income—your revenue is tied directly to how many hours you work. The only way to grow under this model? Work more hours—which isn’t scalable.

Why Value-Based Pricing Supports Growth:

✔ You get paid for expertise, not time. Clients care about results, not how long it takes you to get there.

✔ Increases profit margins. Fixed fees allow you to build efficiencies that boost profitability.

✔ Encourages efficiency. Instead of stretching tasks over more billable hours, you focus on delivering faster, high-value results.

Example:

Instead of charging $250 per hour for advisory services, charge a flat fee of $2,500 per engagement. If you complete the work efficiently in 8 hours instead of 10, your effective hourly rate increases—without raising prices.

✅ Action Step:

Identify one service where you can switch from hourly billing to a fixed or value-based price.

2. Tier Your Pricing to Serve Different Client Segments

Not all clients have the same needs. A one-size-fits-all pricing model limits growth because it doesn’t give clients options.

A tiered pricing model allows you to offer different levels of service at different price points, making it easier to scale while maintaining profitability.

Example: CPA Firm Pricing Tiers

✅ Basic Package ($1,000/month) – Bookkeeping, monthly financial reports.

✅ Growth Package ($2,500/month) – Includes tax planning and quarterly advisory calls.

✅ Premium Package ($5,000/month) – CFO services, cash flow projections, financial strategy sessions.

Why This Works:

✅ Action Step:

Design a three-tier pricing model for one of your services to give clients clear choices.

3. Move to Subscription-Based Pricing for Recurring Revenue

One of the biggest challenges CPA firms face is the feast-or-famine cycle—relying on busy seasons for revenue and scrambling for work in between.

A subscription-based pricing model smooths cash flow and ensures predictable income each month.

How to Implement Subscription Pricing:

Example:

Instead of charging $3,000 per tax return, offer a $750/month tax and advisory subscription that includes year-round planning.

✅ Action Step:

Convert one service into a recurring subscription model to create consistent revenue.

4. Price for Profitability, Not Just Covering Costs

Too many CPAs set prices based on covering expenses plus a small margin—but this approach limits your growth potential. Instead, price your services for profitability and future investments.

How to Price for Growth:

✔ Calculate your ideal profit margin—then build pricing around that.

✔ Factor in overhead AND future hires—not just current expenses.

✔ Account for non-billable time (marketing, admin, networking).

Example:

If you need a 40% profit margin and it takes 10 hours to complete a tax return, your price shouldn’t be based on just the labor—it should also account for software, admin costs, and firm growth.

✅ Action Step:

Review your pricing to ensure you’re pricing for profitability, not survival.

5. Stop Competing on Price—Compete on Value

If you set your prices based on what other CPA firms charge, you’ll always be competing in a race to the bottom. Instead, focus on value-driven pricing—charging based on the results and impact you provide.

How to Compete on Value Instead of Price:

✔ Clearly define your unique expertise (e.g., “We specialize in government audits”).

✔ Showcase client success stories (e.g., “Saved XYZ Company $50,000 in tax liabilities”).

✔ Offer premium service and strategic insights, not just compliance.

Example:

A client can find a tax return prep service for $500—but if you emphasize how your $2,500 service includes tax planning, audit protection, and advisory, they’ll see the value and happily pay more.

✅ Action Step:

Refine your messaging so clients see the ROI of working with you—not just the cost.

6. Regularly Review and Adjust Your Pricing

Your pricing model shouldn’t stay static. If you haven’t raised prices in years, you’re likely undervaluing your services and leaving money on the table.

How to Review and Adjust Pricing:

✔ Evaluate profitability annually and adjust based on costs, inflation, and demand.

✔ Analyze client profitability—some clients may not be worth keeping at their current rate.

✔ Increase prices for new clients first—then phase in adjustments for existing clients.

✅ Action Step:

If you haven’t raised prices in over a year, plan a strategic price increase for new clients starting next quarter.

Build a Pricing Model That Supports Growth

Your pricing model is more than just a way to charge clients—it’s a growth strategy that determines your profitability, sustainability, and ability to scale.

Key Takeaways for Building a Scalable Pricing Model:

✔ Move away from hourly billing—switch to fixed or value-based pricing.

✔ Offer tiered pricing options to capture different client needs.

✔ Adopt subscription pricing for consistent cash flow.

✔ Set prices based on profitability, not just covering costs.

✔ Compete on value, not price, to attract premium clients.

✔ Regularly adjust your pricing to match your expertise and market demand.

By implementing these strategies, you’ll create a sustainable, scalable pricing model that allows your firm to grow without overworking yourself.

✅ Which pricing strategy will you implement first?