Identifying the Right Clients for CAS

An organization chart in a ball shapeShow your highest-priced package first.

By Hitendra Patil
Accountaneur: The Entrepreneurial Accountant

Will your existing clients or prospects buy higher-priced and more services from you? If you ask them to, will they feel put off?

MORE: Communicating CAS to Clients and Prospects | 21 Ways to Adjust Your Practice in 2021 | The Services That CAS Clients Want | Six Reasons CAS Is King | How to Develop the CAS Mindset
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If you do not ask, will you leave real money on the table? If you do not tell them about more services your firm is capable of providing, will they switch to another accounting firm simply because they were not aware of your other services?

Pitching relevant services to clients and prospects is nearly a fine art. It is fraught with the risk of coming across as is you have only your own interest in mind. At the same time, clients and prospects may not even know that you offer such services or that they need those services. You can lose such opportunities even before you explore those with your clients/prospects.

Client accounting services have great potential and promise to speed up your practice growth. But you need first to identify which of your prospects and existing clients are a great fit to offer CAS. Here are some ways to determine which of them will be a good fit for your CAS offering.

How to evaluate your existing clients, and also prospects

There are some easy ways to identify which clients are the right CAS clients. Evaluate your existing clients and prospects by finding answers to the following questions.

  • Does the prospect have five to 25 (or more) full-time employees?
  • Does the prospect have 20 or more vendors from whom they regularly buy (at least once in three months)?
  • Does the prospect have 50 or more customers/clients to whom they regularly sell (at least once in three months)?
  • Does the prospect have 100 or more monthly sales invoices and vendor bills?
  • Does the prospect have four or more different/separate business software packages (accounting, POS, inventory, etc.)?
  • Does the prospect sell and/or buy on credit (30 or more days between sale/purchase and receiving/making payments)?
  • Does the prospect have in-house bookkeeping/accounting staff?
  • Is the prospect looking to replace in-house/outsourced bookkeeper(s)/accounting staff?
  • Does the prospect have frequent/recurring cash flow challenges?
  • Is the prospect frustrated with inaccurate or delayed financial statements?
  • Does the prospect’s business model involve storing an inventory of raw materials/parts/final products?
  • Will the prospect’s business benefit from tax planning?
  • Does the prospect’s business show a consistent growth trend over the last 12-24 months?

The answers to some or all of these questions from any given client/prospect can help you discover if there is a CAS fit. For example, based on their answers, you can determine:

  • The level of complexity in their accounting
  • The volume of work (and hence what their current cost of accounting is)
  • The level of dependency on accounting information to make business decisions in time
  • The likely pain points (about accounting processes/outcomes) in the minds of the business owner
  • The ways your services can help the business gain/save (e.g., taxes saved), etc.

Based on the information that emerges when you evaluate the answers to the listed questions, you will be able to decide which and how many types of services will benefit the client/prospect. In many cases, you will be able to offer more than just after-the-fact write-up services, which will likely double your current revenue from most clients.

The essence of this evaluation/discovery process is to find out if the client/prospect is actually doing the work that requires more accounting-knowledge/education or whether the client/prospect is mostly performing some business-process-related tasks. If you find that some such work requires an accountant’s expertise, that is where you should pitch your CAS offering.

I have created a CAS-Fit Assessment Wizard to make this easier for you. You can obtain this MS-Excel-based, easy-to-use wizard by submitting a request at Alternatively, you can connect with me on LinkedIn and send me a private message there. My LinkedIn profile is here:

CAS pricing risk management

CAS clients prefer the fixed-fee pricing method because it removes the uncertainty of how much they will pay every month, i.e., it reduces clients’ risk. But this method can create a risk for your firm because if you do not estimate the volume, and the expertise required to deliver the services to each client, you can jeopardize your CAS profitability.

It is, therefore, an absolute necessity that you include a beginning or trial price and an adjusted price clause in your CAS engagement letter and the discussion with the CAS prospects. The best way – and many CAS firms figured this the hard way – is to ensure you minimize your CAS pricing risk by getting the client to agree to:

  • Review the CAS engagement after 60-90 days to relate the final CAS pricing to the actual volume of work of each client
  • Review the CAS engagement every year to relate the growing or reducing volume of work based on the business volume trend of each client
  • Include a clause that allows you to increase the price if the client’s work volume increases or decreases by, say, 10 percent or more

Prospects may balk at such clauses, and that should be your first alert about the client possibly being not a good fit for your higher level of CAS package. But, it is also likely that prospects may not have experienced such clauses from their previous accountants, and hence it is essential to explain why you have that clause in the CAS engagement letter.

If your prospect who has been in business for more than a year provides you (and ideally, you should insist) with past accounting databases, it will be possible for you to identify business transaction volume trends and the quantum thereof. In such a case, you can extrapolate the trend into the future and work out the likely volume of work you will do – and let such prospect know which of your CAS packages will work the best for the prospect. Give your reasoning to the prospect. In such cases, you can safely extend the “pricing revisit” clause to six months to a year, depending on the business volume trend. This method does not apply to start-up companies and those that are in business for less than a year because you cannot easily estimate their business growth.

Most business owners who are reasonably confident about their business growth prospects will not haggle over this “pricing revisit” clause.

How to pitch your CAS packages

Once you have crystallized components and pricing of your CAS packages, the next important thing is to pitch the packages correctly to your prospects. This is where an understanding of human behavior science comes into play. “Psychological pricing” is a fascinating line of consumer research, and there are tons of insights about it available online. I am taking some of the methods that I figured accounting firms are already leveraging out there. Let us see what those are.

Show your highest-priced CAS level package first

By design, your highest-priced CAS package will have the largest number of services (and outcomes) listed under it. By first showing this to the prospects, you are making them aware of what all your firm can deliver to them. Many times, prospects forget to ask for some “good-to-have” services just because they are trying to move away from a current problem (pain point) on which they are focused. When they read all the service items listed, it creates an “anchoring effect,” i.e., a cognitive bias in which humans tend to rely too heavily on the first piece of information they see. The information that follows the first piece of information is invariably, subconsciously compared with the first piece of information.

For CAS packages, when you present the highest-level package first, it can result in prospects feeling they will “lose” some benefits of the highest package if they opt in for a lower package. This triggers another fundamental human need – the fear of loss, i.e., loss aversion need. Several psychological experiments have proven that “losses loom larger than gains” (Kahneman & Tversky, 1979). Fear of loss is considered about twice as powerful as the pleasure of gain. In other words, pitching “you will get these additional benefits if you purchase our higher CAS package” is likely to be half as effective compared to pitching “if you purchase our next lower level of CAS package, you will not have the benefit of these X number of actionable insights.”

The same anchoring effect also applies to the dollar price of your packages. If your prospect gets a “sticker shock,” let that happen first in the pricing discussion. If the prospect feels it is too expensive, it could very well be because the prospect’s business does not need higher, more profound levels of intelligence or the prospect may not have understood the value of such business intelligence (if so, please explain how such intelligence converts into what types of practical business decisions the prospect makes). The price tag will create a pressure on the minds of such prospects who haven’t grown their businesses to the level of receiving the ultimate intelligence professional accountants can provide. The moment such a prospect reads the services listed in the next lower level of your CAS packages and the price tag thereof, the prospect’s mind compares the price with the “anchor price.” Because the next price level is lower than the anchor price, the price pressure gets released immediately, and the prospect becomes more open to explore the next CAS package. At the same time, your lowest-priced CAS package can feel the “cheapest,” and more often than not, the prospect would want to avoid being seen as the one who made a “cheap choice.” It is, therefore, critically important that your intermediate package is as profitable as possible for your firm.

Give your pricing “why”

Your prospects and clients are NOT professional accountants or even educated in accounting. They simply do not know what it takes to produce the levels of work required to deliver the intelligence and insights they see in your CAS packages. They have little knowledge of your actual costs, the investments you have made into acquiring the accounting expertise needed and your profit margins. Hence, they may perceive your pricing as “too expensive” or even “too low” (creating doubts about the quality of your work). These perceptions are based on external factors such as market price trends or what they have been paying until now.

To overcome these external perceptions, you need to tell why your prices are what they are. It helps prospects correlate the cost and quality equation to make the pricing feel reasonable. Some examples of your pricing why could be:

  • “Our <client industry> expert who will work on your account has helped X number of similar businesses in your industry based on our expert’s Y number of years of experience in his/her career. About Z percent of our clients in your industry have grown year on year by N percent” OR
  • “A licensed CPA/bookkeeper/financial advisor will review your numbers every month to make sure you are getting the power of expertise what we have” OR
  • “We guarantee 100 percent accuracy, and if we ever make any rarest of rare mistake, we will rectify the mistake at our cost and bear the statutory penalties, if any, because of our mistake.”

Resist the urge to relate your price to your cost or the time it takes for you to produce the work. It is because a non-accountant cannot fathom why it should take so much time to produce the work and why it should cost so much.

2 Responses to “Identifying the Right Clients for CAS”

  1. Lee Frederiksen

    Great overview of how to select and approach these prospects. Love you strategy of sharing the
    “why” of your pricing. Thanks for sharing

    • Hitendra R. Patil

      Thank you, Lee, for taking the time to read the post and share your thoughts. Appreciate it! You are a legend in providing marketing leadership expertise to accounting firms, and I am so glad that the “pricing why” strategy resonated with you.


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