What Should Bookkeeping Cost? The 1 to 2% of Revenue Benchmark
Almost every business owner who shops for bookkeeping does the same thing: they collect three or four quotes and pick a number out of the middle. It feels responsible. It's also the reason so many owners end up paying twice, once for the cheap books and again for the cleanup.
There's a more useful way to look at the number, and it's the one accountants use on themselves.
The benchmark: 1 to 2% of revenue
Across the accounting profession, total accounting spend for a small business is commonly benchmarked at 1 to 2% of annual revenue. That covers the ongoing work: bookkeeping, reconciliation, financial statements, and the time it takes to turn those statements into decisions.
It's a benchmark, not a law. A simple service business with one bank account sits at the low end or below it. A product business with inventory, three sales channels, and payroll in four states sits at the top of it or above. But it's a far better starting point than "what did the other guy quote," because it scales with the thing that actually drives the work.
Here's what the band works out to:
| Annual revenue | 1% of revenue | 2% of revenue | Per month |
|---|---|---|---|
| $250,000 | $2,500 | $5,000 | $208 to $417 |
| $500,000 | $5,000 | $10,000 | $417 to $833 |
| $1,000,000 | $10,000 | $20,000 | $833 to $1,667 |
| $2,000,000 | $20,000 | $40,000 | $1,667 to $3,333 |
| $3,000,000 | $30,000 | $60,000 | $2,500 to $5,000 |
If you're doing $1.2M a year and paying $250 a month for bookkeeping, that's 0.25% of revenue. That is not a bargain. That is a warning light. Somebody is spending about four hours a month on a business that needs twenty, and the gap shows up later as a cleanup project, a missed deduction, or an estimated payment built on numbers that were never right.
Why the number scales with revenue
This is the part that feels unfair when you first hear it. Why should the same monthly work cost more just because you sell more?
It shouldn't. And it isn't the same work.
You don't pay the same to insure and maintain a one-room shack and a twelve-room house. It isn't that the roofer charges the wealthy more. It's that there is more roof.
Revenue is a proxy for complexity, and complexity is what you're actually buying against. More revenue almost always means more transactions, more accounts to reconcile, more people on payroll, more states with a filing obligation, and more consequences attached to getting any of it wrong.
Two businesses, drawn to show the difference:
| Business A | Business B | |
|---|---|---|
| Annual revenue | $200,000 | $3,000,000 |
| Employees | 0 | 15 |
| Sales channels | 1 | 3 |
| Bank and card accounts to reconcile | 2 | 7 |
| Payroll runs per year | 0 | 26 |
| Payroll tax filings per year | 0 | 20+ |
| States with a sales tax obligation | 1 | 6 |
| Transactions per month | roughly 150 | roughly 2,500 |
| What one bad month costs | a corrected P&L | a wrong estimated payment, a late filing penalty, and a hiring decision made on bad numbers |
Business B is not fifteen times the revenue of Business A and fifteen times the price. It's a different job. Payroll alone introduces filings with deadlines and penalties attached. Six states with a sales tax obligation means six sets of rules, six due dates, and six ways to be late. Every additional sales channel has its own payout structure, its own fees, and its own way of handling returns, and all of it has to be separated correctly or the financials are simply wrong.
There's a second thing that scales, and owners rarely price it in: exposure. At $200K, a bookkeeping error is an inconvenience. At $3M, with employees and multi-state obligations, the same error is a notice, a penalty, and interest. You're not only buying more hours as you grow. You're buying a wider margin for being right.
Where our pricing lands against the benchmark
We quote a flat monthly fee rather than a percentage of your revenue, which is the whole point of the argument above. What sets it is the work in your books, not what you happen to bring in, with payroll and sales tax available as add-ons and your business tax return included at every level.
Run those against revenue:
| Annual revenue | Our package | Annual fee | Percent of revenue |
|---|---|---|---|
| $250,000 | Foundations | $9,600 | 3.8% |
| $500,000 | Foundations | $9,600 | 1.9% |
| $800,000 | Foundations | $10,800 | 1.35% |
| $1,200,000 | Growth | $12,000 | 1.0% |
| $2,000,000 | Partner | $18,000 | 0.9% |
Two honest observations about that table.
Below about $500K in revenue, we are above the benchmark, and we'll tell you so on the call. A business doing $250K is paying close to 4% of revenue for monthly CPA-reviewed books, and for most owners at that stage that is more structure than the business needs yet. We would rather say that out loud than sell you a package you'll resent in six months.
Above roughly $800K, the percentage falls as you grow. Our pricing is built on the complexity of the work, not on a slice of your revenue, so the better your year, the smaller the share of it we take. That's the opposite of how most percentage-based professional fees behave, and it's deliberate.
What the fee is actually buying
If bookkeeping is only a record of what already happened, then price is the only thing left to compare, and the cheapest bidder always wins. That comparison is the trap.
The reason to spend inside the benchmark instead of under it is that the work is supposed to produce three specific outcomes:
- You pay yourself consistently, on a schedule, in an amount the business can actually support, instead of whatever is left in the account on the 30th.
- You take a real profit distribution, quarterly, as the owner. Not a number on a report. Cash.
- The business covers its tax bill, business and personal, because the money was set aside as it came in rather than found in April.
Books that do not produce those three things are a filing service. Books that do are the reason the fee makes sense. When an owner tells us the price feels high, the honest question underneath it is usually not "is this too expensive" but "will this actually change anything for me." Those are very different conversations, and only one of them is about money.
How to use the benchmark when you're shopping
- Work out your own band first. Take 1 and 2% of last year's revenue and divide by twelve. Now you have a range to hold quotes against instead of holding them against each other.
- Treat anything far below 1% as a question, not a win. Ask what is included, who reviews the work, and what happens when something doesn't reconcile.
- Ask what you get beyond a closed month. If the answer is a P&L and nothing else, you're buying history. History is worth something, but it isn't worth a premium.
- Expect the number to move as you grow. A fee that never changes while your revenue triples is not loyalty. It usually means the scope quietly stopped matching the business.
The takeaway
One to 2% of revenue is the range worth planning around, and where you land inside it depends on complexity: employees, channels, inventory, states, and how much is riding on the numbers being right. Under that range, you are usually buying data entry and paying the difference later. Inside it, you should be getting books you can make decisions on, a paycheck you can count on, and a tax bill that doesn't ambush you.
How we arrive at a number is explained on the pricing section of our home page, so you can see what drives it before you ever talk to us.
Not sure whether you're overpaying or underpaying?
Our Diagnostic Review goes inside your actual QuickBooks account and tells you in writing what's set up correctly, what needs a second look, and what the current state of your books is really costing you.
Common questions
How much should bookkeeping cost for a small business?
A common benchmark is roughly 1 to 2 percent of revenue for ongoing bookkeeping, though the real driver is transaction volume and complexity rather than sales alone. A simple service business with few accounts sits at the low end, while a busy Shopify store with multiple sales channels sits higher. If you are paying far more than a couple percent, it is worth asking what is making the work so heavy.
Is bookkeeping priced as a percentage of my sales?
Not directly. Most good bookkeepers price on the amount of work, meaning how many transactions, accounts, and sales channels they have to handle each month, and the 1 to 2 percent of revenue figure is just a sanity check. Two businesses with the same revenue can cost very different amounts if one has clean, low volume and the other has hundreds of daily orders. Ask for pricing tied to your actual activity, not a flat cut of revenue.
Why does bookkeeping cost more for some businesses than others?
Cost tracks complexity, so more bank and card accounts, more sales platforms, inventory, and higher transaction counts all push the price up. A boutique running one register is far simpler than an ecommerce store selling across Shopify, Amazon, and a marketplace. Knowing what drives your number helps you decide whether to simplify your setup or budget for the work it truly requires.