An innovative pricing model: Services on subscription
One expert says accounting firms should consider subscription pricing rather than fee-for-service.
July 20, 2023
Ron Baker wants to mirror the idea of concierge care in medicine to protect the client-accountant relationship in the profession.
Ron, a triple-threat, is the founder and owner of the VeraSage Institute, a talk show host for The Soul of Enterprise on Voice America, and an author. His newest book, written in cooperation with Paul Dunn, is “Time’s Up! The Subscription Model for Professional Firms.”
Ron started researching the book in 2017 when he realized the subscription model was an emerging topic. He wanted to promote the model to “align the profession’s rhetoric.”
In an episode of Louie Prosperi’s The Successful Bookkeeper podcast, Ron said he was inspired by Joseph Pine’s book, “The Experience Economy,” which helped him realize accountants are already in the profession of transformation — they just don’t treat it in that manner.
“The customer should pay us for the transformation,” Ron said.
How does that scale to a CPA’s services? Accounting firms should price the relationship between the client and the accountant, not the service.
According to Ron’s new book, “There is an obvious disconnect between what professionals say and what their business model does. We say the relationship comes first, but we monetize the services. We have too many customers, and too many who are ‘one and done,’ which keeps us on a treadmill to continuously feed the lead-generation funnel.”
Ron always comes back to the idea of “relationships don’t scale” — meaning that accountants can’t provide the necessary level of value and care to clients if they have thousands of them.
A model for subscription pricing exists in medicine. In concierge medicine, a doctor or group of doctors charges the patient a membership fee before they’ll accept the patient into the practice. Other industries have subscription models too, from hair care to home maintenance.
Ron believes if firms mirror concierge medicine, the relationships would scale. Firms would be able to provide more value to their clients, he said.
Multiple professions have adopted the idea of a subscription model. Ron’s only question for accounting firms is: When will they?