Most clients who ask for a fee and time estimate on an engagement simply want some idea of the size of their project.
Because your client will always remember the lowest figure given, you are better off not giving a range of fees. For example, don’t say the fee will be from $2,000 to $3,000 for a given project. You can be sure that the only number the client will remember is the lower number. You will find yourself defending any fee in excess of the $2,000.
If you tell the client the fee could be around $3,000, you will still get the engagement, but you will have the opportunity to complete the task under the estimate.
Estimate high on the fee, high on the time to complete the job, and if need be, high on the tax results. Assume that you quote an estimated fee of $3,000 and an estimated three weeks to complete an engagement. If you complete the job in two weeks at $2,500, you will be a hero.
Give yourself some room for adjustment by adding at least 25% to the time and money you think a job will actually take. You will have happier clients and far fewer write-offs. Avoid the temptation to quote a lower fee for fear of losing the engagement.
I invite your comments and questions. Contact me at mostad[at]mostad[dot]com or 1-800-654-1654.