How I Charge $2,500 Per Month For Bookkeeping 😱 AP + AR Management

Summary

Zach Pascarell shares insights on elevating bookkeeping services to charge over $2,000 per month. With a focus on QuickBooks Online expertise, he outlines his basic bookkeeping package, including transaction categorization, account reconciliation, and financial reporting. Zach then introduces 'cash management' as an advanced service, encompassing accounts payable and receivable management, offering hands-on bill payment and invoice generation, setting a foundation for higher-value bookkeeping services.

Takeaways

• 😀 Zach Pascarell is a bookkeeper who has been running his own business for four years and currently has over 60 clients.
• 💼 Zach makes more than $30,000 per month in recurring revenue from his bookkeeping services.
• 📚 Zach specializes in bookkeeping using QuickBooks Online, which allows him to be highly efficient and process a large volume of work.
• 📈 He charges more than $2,000 per month for his services by going beyond traditional bookkeeping and offering additional services like cash management.
• 🏦 Zach's basic package includes categorizing transactions, reconciling accounts, and generating financial reports using QuickBooks Online.
• 💳 Cash management involves managing clients' accounts payable and accounts receivable, which goes beyond standard bookkeeping services.
• 🔍 For accounts payable, Zach pays bills for clients using their money, requiring communication from the client about which bills need to be paid.
• 💼 Zach uses clients' business checking accounts to pay bills, either through direct deposit or by electronically mailing checks, depending on the vendor's setup.
• 📝 For accounts receivable, Zach handles sending invoices to customers and clients, using QuickBooks Online as a payment processor.
• 📆 QuickBooks can be set up to send automatic reminders for overdue invoices and can generate accounts receivable aging reports.
• 💰 Zach charges $500 for managing about 100 accounts payable per month and suggests a starting point of $5 per bill for pricing this service. For accounts receivable, he charges an additional $200 for sending about 15 invoices per month.

Q & A

What is the main focus of Zach Pascarell's bookkeeping business?

Zach Pascarell's bookkeeping business focuses on providing expert bookkeeping services using QuickBooks Online, with a specialization in the software and services offered rather than a specific industry niche.

How long has Zach been running his bookkeeping business?

Zach has been running his bookkeeping business for the past four years.

What is the significance of having over 60 bookkeeping clients for Zach's business?

Having over 60 bookkeeping clients signifies that Zach's business is well-established and successful, generating more than $30,000 per month in recurring revenue.

What is the basic package offered by Zach's bookkeeping services?

The basic package includes bookkeeping with QuickBooks Online, which involves categorizing transactions, reconciling accounts, and generating financial reports.

Why does Zach only offer bookkeeping services and not payroll or taxes?

Zach chooses to specialize only in bookkeeping services to maintain his expertise in the area and to be able to charge a premium for his specialized knowledge and efficiency.

What is the concept of 'cash management' as described by Zach?

'Cash management' refers to the service where Zach manages clients' accounts payable and receivable, which goes beyond traditional bookkeeping by dealing with transactions that haven't occurred yet.

How does Zach handle accounts payable for his clients?

Zach handles accounts payable by entering bills into QuickBooks Online in real-time, running an accounts payable aging detail report weekly, and paying the bills due within the next 7 days using the clients' business checking accounts.

What method does Zach use to pay bills on behalf of his clients?

Zach uses the clients' business checking accounts to pay bills, either through direct deposit or by electronically mailing checks, after obtaining approval from the clients.

How does Zach manage accounts receivable for his clients?

Zach manages accounts receivable by sending invoices to customers, setting up automatic reminders for due payments, and running accounts receivable aging reports to keep track of overdue invoices.

What are the additional services that Zach offers to justify charging more than $2,000 per month for bookkeeping?

The additional services include cash management, which encompasses handling accounts payable and receivable, and providing a high level of expertise and efficiency in using QuickBooks Online for bookkeeping tasks.

How does Zach price his cash management services for accounts payable and receivable?

Zach does not have a fixed pricing model but provides a starting point of approximately $5 per bill for accounts payable and $100 for handling about 10 invoices per month for accounts receivable, adjusting the price based on the volume of work.

Outlines

00:00

📚 Expert Bookkeeping Services with QuickBooks Online

Zach Pascarell, a seasoned bookkeeper with a four-year track record, introduces his successful bookkeeping business model. He emphasizes specializing in QuickBooks Online, which allows him to efficiently manage over 60 clients and generate substantial recurring revenue. Zach's niche is not industry-specific but rather focused on the software and services he provides, positioning him as an expert in bookkeeping. His basic package includes transaction categorization, account reconciliation, and financial report generation, all within QuickBooks Online. He also offers advanced services like cash management, which involves handling accounts payable and receivable, setting him apart from traditional bookkeeping services.

05:02

💼 Cash Management: Advanced Bookkeeping Beyond Transactions

This paragraph delves into the concept of cash management, an extension of bookkeeping services that involves active management of accounts payable and receivable. Zach explains how he uses his clients' business checking accounts to pay bills and manage invoices, streamlining the process with the help of online banking features. He details the process of setting up a system for bill payments, including the use of cloud storage or email for communication between the bookkeeper and the client. Zach also discusses the use of two-factor authorization for added security and accuracy in payment processing. He provides a pricing example for this service, charging $500 per month for managing around 100 accounts payable, highlighting the hands-on nature and responsibility involved in this advanced service.

10:03

📈 Managing Accounts Receivable for Timely Payments

Zach continues the discussion on bookkeeping services by focusing on accounts receivable management. He outlines the process of creating and sending invoices to clients, utilizing QuickBooks Online as a payment processor. The paragraph covers the ease of setting up automatic reminders for clients to make payments and the use of aging reports to track overdue invoices. Zach also mentions the convenience of electronic payments through bank transfers or credit cards, facilitated by QuickBooks. He shares a pricing example for managing accounts receivable, suggesting a charge of $200 for sending about 15 invoices per month, and advises that pricing can be scaled based on the client's needs.

Keywords

💡Bookkeeping

Bookkeeping is the process of recording financial transactions in a business. It involves categorizing transactions, reconciling accounts, and generating financial reports. In the video, Zach emphasizes that he specializes in bookkeeping using QuickBooks Online, which allows him to efficiently manage a large volume of work and charge a premium for his services.

💡QuickBooks Online

QuickBooks Online is a cloud-based accounting software that is widely used for bookkeeping and financial management. Zach mentions that he exclusively uses QuickBooks Online for his bookkeeping services, which enables him to become an expert in the software and provide efficient services. This specialization is part of his strategy to charge more for his services.

💡Niche

In the context of the video, a niche refers to a specialized area of focus. Zach clarifies that while he doesn't have a niche in terms of industries (like only serving trucking companies), he has a niche in the software he uses and the services he provides. This niche expertise allows him to charge more for his bookkeeping services.

💡Recurring Revenue

Recurring revenue refers to income that a business receives on a regular basis, typically from subscriptions or regular clients. Zach mentions that he earns over $30,000 per month in recurring revenue from his bookkeeping clients, indicating the stability and profitability of his business model.

💡Accounts Payable

Accounts payable are the obligations a business has to pay off its short-term debts, typically bills from vendors or suppliers. In the video, Zach discusses how he manages clients' accounts payable by paying bills on their behalf, which is a service beyond traditional bookkeeping and contributes to his ability to charge higher fees.

💡Accounts Receivable

Accounts receivable are the amounts of money owed to a business by its customers for goods or services provided. Zach explains that he also manages clients' accounts receivable, which involves sending invoices and following up on payments. This service is crucial for cash flow management and is another way he adds value to his bookkeeping services.

💡Cash Management

Cash management in the video refers to the process of managing a business's cash flow, including both accounts payable and accounts receivable. Zach uses this term to describe his advanced services where he actively manages clients' cash inflows and outflows, which is a significant factor in his ability to charge more for his services.

💡Financial Reports

Financial reports are documents that summarize a business's financial activities, including profit and loss statements and balance sheets. Zach mentions that he generates these reports as part of his bookkeeping services, which are essential for clients to understand their financial health and prepare for tax filings.

💡Service Packages

Service packages refer to bundles of services offered by a business. Zach describes his basic package as just bookkeeping with QuickBooks Online, but he also offers additional services like cash management, which includes managing accounts payable and receivable. These packages are structured to meet different client needs and allow him to charge varying fees.

💡Two-Factor Authorization

Two-factor authorization is a security measure that requires two forms of verification to access an account. Zach discusses using this for added security when paying bills from clients' accounts, ensuring that payments are approved by the client before they are processed, which adds a layer of control and trust in his services.

💡Direct Deposit

Direct deposit is a method of electronic payment where funds are transferred directly into a recipient's bank account. Zach uses this method to pay bills for his clients, which is efficient and secure. He mentions that direct deposit is cheaper and faster than mailing checks, making it a preferred method for his cash management services.

Highlights

Zach Pascarell has been running his own bookkeeping business for four years.

He has over 60 bookkeeping clients and makes more than $30,000 per month in recurring revenue.

Zach specializes in bookkeeping services using QuickBooks Online, positioning himself as an expert in this software.

His basic package includes categorizing transactions, reconciling accounts, and generating financial reports within QuickBooks Online.

Zach does not offer payroll, tax, or CFO services, focusing solely on bookkeeping.

He charges more than $2,000 per month by going beyond traditional bookkeeping services.

Zach introduces 'cash management' as a way to charge higher fees for bookkeeping services.

In cash management, Zach manages clients' accounts payable and receivable, which is beyond typical bookkeeping tasks.

For accounts payable, Zach pays bills for clients using their money, requiring communication about which bills need to be paid.

Zach recommends using a shared cloud service like Google Drive for managing bills that need to be paid.

He uses clients' business checking accounts to pay bills, avoiding additional software costs.

Zach can also set up two-factor authorization for bill payments, adding a layer of security and control.

For accounts receivable, Zach sends invoices to customers and manages their payment through QuickBooks Online.

QuickBooks Online can automatically send reminders for due invoices, streamlining the process for clients.

Zach charges $500 per month for managing about 100 accounts payable, suggesting a fee of about $5 per bill.

He charges an additional $200 per month for sending about 15 invoices, indicating a potential fee of $100 for 10 invoices.

Zach emphasizes the importance of hands-on management and responsibility in providing advanced bookkeeping services.

Transcripts

let me teach you how you can charge more

than $2,000 per month for just

bookkeeping services my name is Zach

pascarell I have been running my own

bookkeeping business for the past four

years I have over 60 bookkeeping clients

I'm making more than $30,000 per month

just in recurring revenue from my

bookkeeping clients I make these videos

just because I'm passionate about my

bookkeeping business I love talking

about bookkeeping and I love teaching

you how you can start and grow your own

bookkeeping business bu the exact same

way that I did let me start by saying I

don't have a niche at least not a niche

in the traditional sense you can have a

niche in the industry that you work with

maybe you only do bookkeeping for

trucking companies or Real Estate

Investors or restaurants but I have a

niche in the software that I use and the

services that I provide this enables me

to be an expert at bookkeeping and

QuickBooks Online I am so fast and so

good at bookkeeping I only do

bookkeeping I don't do payroll I don't

do taxes I don't do CFO Services I only

offer bookkeeping services but I'm still

able to charge more than $2,000 per

month because I go a little bit above

and beyond traditional bookkeeping

services I'm going to get to that in a

few minutes but first let me lay the

foundation for the actual services that

I provide my basic package just

bookkeeping and I only work with

QuickBooks online so I I have a niche in

the services that I provide and the

software that I use and this enables me

to truly be a QuickBooks Online expert I

can do everything so fast so efficiently

in QuickBooks and that helps me process

a large volume of work which means I can

make a lot of money so my basic services

are just bookkeeping with QuickBooks

online that means I categorize your

transactions I reconcile your accounts

and I generate Financial reports I do

everything inside of QuickBooks Online I

don't work with any other software I

don't provide any other services I

categorize your transactions money

coming in money going out income

expenses assets liabilities I reconcile

your accounts every month so I need your

bank statements and your credit card

statements and your loan statements

every month just to make sure everything

in QuickBooks penny for Penny exactly

accurate and then I generate your

financial reports that's the whole point

of bookkeeping I will send you your

profit and loss on a monthly basis I'll

man manage your balance sheet and then

at the end of the year your profit and

loss balance sheet all accurate all

updated ready to go for your tax

accountant so that you can be super

hands off with your bookkeeping and tax

process now let's talk about how I take

it a step further how you can charge

$22,000 or more for bookkeeping services

I call this cash management I manage

clients accounts payable and accounts

receivable this really goes in line hand

inand with bookkeeping services but it's

far beyond traditional bookkeeping

services what I just described

categorizing transactions I'm only

looking at transactions that have

already occurred so you take your debit

card you go to Home Depot or you go to

the bank and deposit a check that's

money going out in expense money coming

in income but it's already happened with

cash Management Services I'm looking at

money that hasn't moved yet I'm looking

at transactions that haven't occurred

yet so specifically let me break it down

how I do it and how I charge for it

accounts payable and accounts receivable

they're pretty they're pretty similar

but they do have a couple differences

let's start with accounts payable so I

am actually paying bills for my clients

I'm not using my own money obviously I'm

using their money to pay their bills so

the process is pretty straightforward

they need to tell me somehow they need

to communicate with me the bills that

need to be paid so this does require

some work from the business owner or the

office manager or the project manager

somebody on their team needs to tell me

what bills need to be paid so that I can

manage their accounts payable this

happens a couple different ways the

client can set up a Google drive or a

Dropbox or a Microsoft One drive or some

type of cloud and then they can give me

access to that Google Drive and then

they can have a couple folders they

could have bills waiting to be approved

for payment bills approved for payment

bills that need to be paid accounts

payable whatever you want to call it the

client needs to tell me these bills are

okay to be paid

so they can set up a Google Drive and

give me access to it or they can just

email me they can send me emails in real

time hey pay this bill hey pay that bill

that strategy works okay if there are

few bills but as soon as there become

more than three or four bills per week

it can be a little bit difficult to send

individual emails on a daily basis so if

there are more than four or five bills

per week I recommend set up a Google

Drive or a Dropbox shared access between

the bookkeeper and the business owner

and then develop a system for just

somebody on their team telling you as

the bookkeeper which bills need to be

paid but if it's only a couple bills per

week like I said emails work fine once I

get the bills that need to be paid I

enter them into QuickBooks online and

then every week I will run an accounts

payable aging detail report so I'm

entering the bills in real time and then

I will look to see which bills are due

in the next 7 days and then I will pay

all of those bills now how do I pay

bills I don't have a checkbook for my

client like I said I'm not actually

using my own money I'm using the

client's money to pay their bills and I

don't really work with any other

software so I'm not working with

bill.com or I'm not using other accounts

payable management software I'm actually

and I'm also not using QuickBooks online

because they charge $10 every month per

contractor that's incredibly expensive I

actually use use my clients business

checking accounts to pay their bills

most business checking accounts have

either cash management treasury

management or bill pay or some

combination that's actually where I got

the name of these Services cash

management because that's usually what

these business checking accounts call

them on in their online banking system

cash management treasury management bill

pay basically I can pay these people

these vendors contractors subcontractors

I can pay them straight from my client's

business checking account now I need my

own access I need a username I need a

password so that I can access my

client's bank accounts and then we've

already gone through an approval process

so the client already tells me hey these

bills are good to be paid so I enter

them into the business checking account

online treasury management cash

management system and then I can

actually pay these people AC direct

deposit now we can take it a step

further with two Factor

authorization so I can generate the

report inside the business checking

account and then the client the business

owner the office manager the project

manager can actually go in and approve

the payments that I have submitted that

way we can double check the work we have

internal controls and there's there's no

chance of any mistakes happening because

I enter the information and somebody

else approves the information now that

only works if you have their a direct

deposit information so you need the pay

and the vendors account number and

routing number that's not always an

option so we can also electronically

mail checks and that's usually an option

with most business checking accounts all

we need to know is the address of the

paye so I can actually electronically

mail checks straight from my business

checking account to my vendors and

contractors it's a little bit more

expensive it usually costs about 70

cents per check but if you think about

it with a stamp and an envelope printing

the checks it's money well worth it

because you're going to spend at least

70 cents and so much more time

physically mailing these checks a direct

deposit is usually like 5 to 10 cents

per transaction so cheap so easy and it

happen next day so today if I process an

a payment at 3 p.m. it'll arrive in the

in the vendor's bank account the next

day okay so that's how I manage accounts

payable and the way I price it I don't

have an exact model I do know that right

now I have a couple clients who have

about 100 accounts payable per month and

I charge them $500 per month so there's

not an exact science because I don't

have a lot of clients who I do this for

but it is a lot of work it does require

that I'm very Hands-On with these

clients there's a lot of responsibility

involved with paying these bills keeping

up with it making sure everything goes

out on time so this is a more advanced

service so I do charge $500 for 100

bills and then it would obviously go

down or go up depending on the number of

bills that need to be paid on a weekly

or monthly basis but I think about $5

per bill that needs to be paid is

probably a good starting point okay now

let's talk about accounts receivable

it's a very similar process but it's the

exact opposite instead of paying people

now we are sending invoices to customers

and clients and this is much easier but

it's very very important so many

business owners struggle to manage their

accounts receivable so us as bookkeepers

we can come in and we can offer to

handle your clients accounts receivable

that way they can be confident that

everybody is paying on time and if

they're not paying on time we can follow

up with them I use QuickBooks Online to

manage all of my clients accounts

receivable and I also use QuickBooks

Online as a payment processor QuickBooks

Online charges 1% for AC transfers and

3% for credit card transfers which is

usually pretty consistent across the

industry

so this the process is pretty similar if

an invoice needs to be created my

clients will email me hey Zach please

create an invoice I just need to know

basic information the customer's name

the date of the invoice the terms net 30

net 15 do on receipt a description for

the invoice and the amount and then I

also need to know the email address for

the customer if it's a new customer tell

me the email address if it's a

pre-existing customer I should already

have have their email address in the

system that's it that's the only

information I need and then I can email

the invoice directly to the customer or

the client straight from the QuickBooks

account and then the client can pay the

invoice through their email

electronically bank transfer credit card

and then finally in QuickBooks you can

set up automatic reminders so 3 days

after the due date 7 days after the due

date 30 days after the due date

QuickBooks will automatically send

emails straight to the client saying hey

reminder this invoice is due please

submit payment at your earliest

convenience and then finally we can run

an accounts receivable aging report from

QuickBooks you can even set it up on an

automatic email so every Friday An

accounts receivable aging report can get

emailed straight to your client straight

from QuickBook so they can see which

invoices are 30 days overdue 60 days

overdue which invoices are current you

might need to take it a step further and

reach out out directly to the client or

the customer if they haven't paid their

invoice in 30 days but QuickBooks makes

it so simple to manage accounts

receivable you can do it for your

clients I have one client who I send

about 15 invoices per month and I charge

them in additional $200 so invoices do

require a little bit more work than

bills actually maybe not they might be

pretty similar I don't have an exact

pricing structure set up for quoting and

pricing accounts receivable and accounts

payable $500 for a 100 accounts payable

per month seems to be a pretty good

starting point 10 or so invoices per

month for $100 seems to be a good price

point and then you can just multiply it

by that if they have 50 invoices per

month maybe charge them $500 something

like that but I hope this video is

helpful I hope it gives you a different

perspective on some additional

bookkeeping services that you can

provide that way you can charge more

than $2,000 per month for some of your

larger bookkeeping clients