The Professional's Guide to Value Pricing 2000 [With CD-ROM] (Paperback)

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Book Description
This guide shows professionals how to price their services for greater profit. The Guide is packed with the information needed to evaluate the economics and ethics of alternative billing methods. Professionals are provided with the information they need to analyse the variety of billing methods and select amongst them with respect to their individual practices and clients. The Guide contains detailed information on value pricing consulting, revenue management through value pricing, electronic commerce pricing, and the relationship between total quality service and value pricing, as well as fully demonstrating the shift from hourly billing to value pricing.

From the Author
Time is NOT money!!
In 1748 Benjamin Franklin wrote those immortal words: Time is money. One hundred years later, in 1848, Karl Marx and Friedrich Engels posited the labor theory of value in The Communist Manifesto­i.e., the value of a commodity is determined by its labor inputs. Subsequently, perhaps the most famous of all lawyers, Abraham Lincoln, said: Time is an attorney's stock in trade. As much as I respect Benjamin Franklin and Abraham Lincoln, they were wrong. And as for Karl Marx, well, communism has been repudiated throughout the world, a dismal failure everywhere it has been tried. Its influence is rapidly diminishing, and the only area where it thrives, besides college campuses, is the professional service firm.Professionals have been incorrectly trained to correlate their labor efforts with the value of their services. However, Marx's labor theory of value is emphatically false. For if it were true, land shouldn't have any value, because it has no labor inputs. Or a rock found next to a diamond should be of equal value, since each took the same amount of labor hours to extract. Yet, how many rocks do you see displayed in the local mall's jewelry store? The fact of the matter is, value is subjective, and is determined solely by the customer. Ultimately, the price of all goods and services in the marketplace are determined by just two factors: preferences and technology. Customers are buying results, not efforts. Measuring, and charging by, hours spent is tracking efforts, not results. In effect, professionals are chasing the wrong rabbit.I believe professionals need to price based upon the value of their services to the customer, not the labor hours involved in producing the service. For too long the professions have been weaned to the Almighty Hour, much to their disadvantage. The billable hour is comfortable for most professionals because it shifts one hundred percent of the risk to the customer. But in a free market, when you take less risk, your rewards will be limited. This is the main objection I have to the Almighty Hour: While it provides a comfortable floor beneath us­in terms of revenue and profitability­it also places an artificial ceiling above our heads, one that we cannot, as a profession, break through. This is borne out by analyzing average realization rates for accounting firms throughout the country: They are less than 100% of standard billable rates. However, that ceiling is artificial, and we placed it there, not our customers.It is time for professionals to reject the false measurement of value proffered by Karl Marx, and embrace Value Pricing. That is the reason I wrote this book: To kill, once and for all, the billable hour. We need to embrace the subjective theory of value, and ascertain for each customer, for each service, the value we are adding to their lives, and price accordingly. Price is a major marketing decision, and far too important to be left to the 50+ year old practice of hourly billing. This book will provide you with the theoretical foundations of value, from an economic perspective. Also, it explores how other industries price their goods and services. It discusses the history of hourly billing, what customers really buy, the ethics of hourly billing and value pricing, and the all-important issue of self-esteem. It also provides a proven method for implementing Value Pricing into your professional firm by utilizing Fixed Price Agreements and Change Orders, as well as innovative pricing methods you can utilize to receive the full value of the services you provide. It comes with a computer disk that contains sample checklists, Fixed Price Agreements, and Change Orders. Also, a test is available in order to obtain four hours of Continuing Professional Education credit.Any professional who is interested in being among the leaders of their profession moving away from the hourly billing method to achieve a competitive differentiation and who is tired of sacrificing profits on the Altar of the Almighty Hour should read this book.Here is what some leading experts in the accounting and legal profession have had to say about The Professional's Guide to Value Pricing: Ron Baker is arguably the profession's most original thinker. If you want to make money­and I mean significantly more money­from your practice, this book is a must-read. Ron understands this subject like the back of his hand and he's passionate about it. He could safely offer a hundred-fold money-back guarantee.Chris Frederiksen, CPAFrederiksen & Co.Mill Valley, California, and Bristol, United KingdomRon Baker is one of the master thinkers in the accounting profession. Few people have thought as long and hard about Total Quality Service and Value Pricing as he has. Every serious CPA who wants to add value and be compensated accordingly should own, read, and re-read this extraordinary book.Troy Waugh, CPA, MBAPresident, Waugh & Co.Brentwood, TennesseeRon Baker is a maverick CPA. He is one of the few original thinkers in our profession. This book is a must-read for CPAs who are tired of being underpaid for what they do and are willing to change how they do business. His book is a guidepost for the ultimate success of the professional firm because it is customer focused­from service delivery and collection to service retention.Allan S. Boress, CPA, CFEAllan S. Boress and AssociatesI have been involved in moving the legal and CPA professions to alternative billing since 1981. I know the difficulties of changing a professional's paradigm from hourly billing to billing based on value added. This book provides excellent guidance and precedents for installing alternative billing. Professionals who use the help available in this book will be able to increase their own income while providing clients top quality service at lower costs­a win-win situation.William Cobb, CPAConsultant to the legal and accounting professions --This text refers to an out of print or unavailable edition of this title.

5 Reviews 5 star:  (5) 4 star:    (0) 3 star:    (0) 2 star:    (0) 1 star:    (0)           Average Customer Review 5.0 out of 5 stars (5 customer reviews)		Share your thoughts with other customers: Create your own review
Most Helpful Customer Reviews   4 of 5 people found the following review helpful: 5.0 out of 5 stars This book will change your life, 23 Jan 2000 By A Customer Having read the previous edition of this book for just 20 minutes I e-mailed the author to tell him that "I have seen this book described as the most important book in the profession. Without a shadow of a doubt, it will change my life." The new chapters make this latest edition even better. Read the chapter on Total Quality Service to understand how to compete in the future. Ron Baker will completely change your views on pricing professional services. You will start to charge what you are worth with a consequent improvement in both income and self esteem. Recently I was in a group of 70 accountants who listened to the author speak on Value Pricing for just ten minutes. At the end he received a standing ovation. In my 30 years in the profession I have never seen accountants show such enthusiasm for a speaker and his subject. If you want to change your professional (and personal) life for the better buy this book. Comment Comment | Permalink | Was this review helpful to you? Yes No (Report this)   5.0 out of 5 stars The Firm of the Future, 8 Mar 2009 By  Bob (UK) - See all my reviews The Firm of the Future: A Guide for Accountants, Lawyers, and Other Professional ServicesRon's ideas are an inspiration for the practicing accountant,I know it has been said before but I wish I had this book 20 years ago.The book made me realise that I had to change the way I ran my practice and completely changed the way I view my team, the customers,the services offered and my role.Like many others over the years I have been working harder and harder when I should have been working smarter.I am using the ideas in the book and it feels as if a great weight has been lifted from my shoulders.I thoroughly recommend this book to any professional looking for a better way to run their practice and their life.If you ever have the chance to hear Ron speak make sure you don't miss the opportunity,for me it was a revalation. Comment Comment | Permalink | Was this review helpful to you? Yes No (Report this)   5.0 out of 5 stars I wish I had read this 20 years ago - Brilliant work !, 31 Mar 1999 By A Customer This review is from: Professional Guide to Value Pricing (Paperback) Ron Baker has simply explained that in many cases if not even all cases, the client does not give a damn about how long an asignement took - he/she only cares about the "value " of the work !But how do we bill ? By time, irrespective of value ! The author debunks myths in a very clear & powerful way. Does this mean that we start to exploit our clients ? No, he clearly reinforces the value of value. He makes us see what we do through the perspective of the client & his value billing approach makes graet sense. the book contains valuable practical guides, easy to understand , about numerous billing concepts as well as examples & templates to allow the reader to put the theory into practice. I have, it works ! Comment Comment | Permalink | Was this review helpful to you? Yes No (Report this) Share your thoughts with other customers: Create your own review › See all 5 customer reviews...		Most Recent Customer Reviews 5.0 out of 5 stars Best book ever explaining "the CPA business" to CPA's After practicing in public accounting for 24 years, this book has now changed the way I do business. Read more Published on 6 Jan 1999 5.0 out of 5 stars A Must Read For Increasing Your Revenue! If you want to increase your revenue by working smarter, then this is the book for you! Ron Baker gives you excellent advice on how to be compensated based on the customer's... Read more Published on 7 Nov 1998 Search Customer Reviews Only search this product's reviews › See all 5 customer reviews...

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