Mark Wickersham tells accountants to calculate return on investment before buying software, not just look at the price tag. A $100/month tool that saves one hour monthly and boosts fees by 20% pays for itself. The difference between a cost-focused mindset and an entrepreneurial one comes down to asking what you'll actually gain.
In this video, I'm going to share with you the one thing you've got to ask yourself first before you start looking at buying software in the profession. Right now in the accounting profession, software is becoming increasingly prevalent. There is software to do so many things, so many apps that can make our life easier, but it can get overwhelming. And as somebody said to me the other day, Mark, I worry about the ongoing subscriptions and the costs in my business. And because of that I don't invest much in software. And I think that's a big mistake because as a profession we tend to be very focused on costs. And what we have to do is think more like the entrepreneur. We have to think about return on investment. So whenever you're thinking about software, you really need to ask this question. This is really critically important. That is, what are the benefits of the software? What's it going to do for you? You need to ask yourself that question and list what they are. It might save you time, it might make you money, help you win clients. Make a list of the benefits. Let me give you an example. I had an email recently from somebody who was questioning the subscription to some software that I have. It's called effective pricing. It enables you to sit down in front of your clients and have a pricing conversation and come up with a value based price. A price is going to be much higher than what you would have had before. Not only that, it also automates the process of proposals afterwards. Engagement letters, which saves time. Two big benefits. Now, one of the versions, one of the plans of the Software is about $35 and you can use it for up to 10 clients. And the question was this, Mark.
That'S $3.50 per client per month. So once I've priced them, what's the benefit of that? I don't understand it. And the question was a great question, but the question was because as a profession we're focused so much on costs and analyzing the costs. And what's the cost of that software going to be per month, per client every time I use it? And that's the wrong way of thinking. If you want to grow your firm, if you want to explode with growth, you have to start thinking like the entrepreneur. And that means starting with, okay, so what's the benefit of the software? So let's use some examples, some numbers. Let's imagine that the pricing software is, let's say, for example, it's.
A hundred dollars a month. Sorry, yes, $100 a month and you can price 10 clients. And let's imagine that because of the. Because of the ability to streamline the process of creating a proposal, a letter of engagement, we need to therefore ask ourselves the question, what's our time worth to us? What's your time worth to you? And it's probably worth a lot more than you currently think. And if you're charging based on the hour, which is a mistake, then you're probably undervaluing yourself. But let's use a number. Let's imagine that you value yourself out at a hundred bucks an hour. And let's imagine that the software, you use it once a month to price a client, to create a proposal, to print it out. And let's imagine that you do just one a month. And let's imagine that saves you an hour creating the proposals, then saving you one hour every month is saving you $100 worth of your time. And therefore the software is breaking even. Because if you're paying a hundred bucks a month and it allows you to save 100 bucks worth of your time every single month, it's not costing you anything. But let's look at the other benefits. What if the software helps you to get better prices? And research and evidence over the last few years shows that many people get at least 20% higher prices. So imagine you have 10 clients, and let's imagine those 10 clients, on average they are worth $2,000, 2,000 pounds to you every single year. And pricing software, when you use it with those clients, enables you to increase the price by 20%. That's $400 or 400 pounds across 10 clients, that's 4,000. If the software costs you 100amonth and over 12 months, that's 1,200. And if you can invest 1,200 in software, then that will save you $1,200 worth of time and help you to get 4,000 in additional prices, which all falls to bottom line profit. Then let me ask you this question. Is that software expensive? Somebody focused on cost will say yes. The entrepreneur will say, return investment. I spend 1200, I save 1200 of time and I get four grand of extra profit every year. That's a no brainer. We have to change our mindset. We have to think like the entrepreneur I used to in my accounting firm many years ago in the 1990s, focus on costs. I made so many mistakes, it caused a real problem. Now I invest in so much software. It's how I've managed to build a business that makes over a million every single year. And I do that with three people. Me, Sarah, Emily. How can we run a business that big with three people because I invest in software, because I understand the value of my time and any software, however expensive it is, if it gives me a return investment, that's going to enable me to focus on doing what I do, helping accounting professionals and grow this business. I hope that serves. I hope that helps. If you like the video, give it the thumbs up, share it comment and underneath here you'll find some links to some other stuff. Goodbye for now.
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