Should a £2m client pay the same as a £200k one?

Two limited companies come to you in the same month.

One turns over £200,000. The other turns over £2m. Both want the same things: annual accounts, a corporation tax return, and someone to ring when something comes up.

Should they pay the same fee?

Almost everyone says no immediately. And almost every firm charges them nearly the same anyway, because the work looks similar when you write it down.

Why the fee usually barely moves

The reason is that most firms price from the job list. Accounts, corporation tax, a director's return. That list is identical for both clients, so the fee comes out nearly identical, with perhaps a bit added for the bigger one because it feels like it should be more.

That "bit added because it feels like it should be" is doing a lot of work, and because nobody can explain it, it is the first thing to fall over when questioned.

The way out is not a better instinct. It is being clear about what actually differs.

What you are really charging for

It is not extra hours. That is worth saying plainly, because "the bigger one takes longer" is where most firms reach first, and it is the weakest possible ground. If a client ever gets you onto how long something takes, you have handed them a stick.

Two things genuinely differ, and neither is time.

The risk you are carrying. A bigger business has more transactions, more people touching them, more VAT at stake, more scope for something to be wrong, and a great deal more at stake if it is. Your professional exposure on a £2m company is not the same as on a £200k one, and it never was. You have been carrying that difference for free.

What is at stake for them. A client with more to lose values getting it right more highly. That is not you charging them because they can afford it. It is the same service being worth more to one of them than the other, in exactly the way insurance on a more valuable thing costs more.

You are not charging the larger client for extra hours. You are charging for the extra risk you carry and the greater value of getting it right.

Turnover as the proxy

Turnover is not perfect. A £2m business with three customers and clean records can be simpler than a £400k one with a thousand small transactions and a shoebox.

That is fine, because turnover is not doing the whole job. It sets the band, and the other drivers - record quality, transaction volume, how many income sources, how involved they want you to be - move the fee within it.

What turnover is good at is stopping the anchoring problem. Without a band, every client is priced from wherever your head happens to start, which is usually somewhere near the last client you quoted for. That is why so many firms find their fees clustered in a narrow range regardless of who they are working for.

The conversation you avoid entirely

Here is the practical benefit, and it is bigger than the extra fee.

Without bands, charging the larger client more requires you to justify it in the moment, to their face, which nobody enjoys and which sounds uncomfortably like "you look like you can afford it".

With bands, nothing needs justifying. You picked their revenue band at the start of the meeting, alongside their client type, before either of you knew what the fee would be. The price then came out of the system. It is not a judgement you made about them. It is how your pricing works, and it works that way for everybody.

That is a completely different conversation, and it is one you can have without flinching.

Setting the bands

The mechanics are simple enough that firms overthink them.

Pick your bands so they actually split your client base rather than putting eighty per cent of it in one bucket. If nearly everyone you act for is under £500k, a band that runs from nothing to £1m is doing no work at all.

Then decide what each step up is worth. It should rise meaningfully, because the risk does. A ten per cent step between bands is not describing a real difference.

Set it once and stop thinking about it. That is the point of a system: the thinking happens once, calmly, rather than every time in a meeting when you want the client to like you.

In Power Pricing the bands are a setting, and every service scales through them automatically. You choose the client's band when you enter their details, and each service prices itself accordingly. There is no arithmetic in the meeting and no moment where you have to decide, live, what a bigger client is worth.

The thing to take away

Charging every client the same fee for the same service is not fair. It looks fair, which is why it survives.

What it actually does is overcharge your smallest clients slightly and undercharge your largest ones considerably. The small ones sometimes leave over it. The large ones stay, quietly, on a fee that has nothing to do with what you are worth to them.

That is the expensive half, and it is the half nobody complains about.