Beyond Tax Season: Where will your accounting business’ future growth come from?
My meeting with Tim, the Managing Partner of a CPA firm couldn’t have started off more worse ! He was on the phone with one of his clients who was yelling at the other end of the phone “how the heck can you charge me so much for…”
After 20 minutes of waiting patiently for the call to get over and hoping against hope that I will have a nice chat with Tim, finally he got off the call and said “Gosh… that was a great start to my day !!”…
Tim’s firm offers mainly tax preparation services and over the last few quarters, he had convinced some of his corporate clients to assign him financial statements preparation and analysis work. The books were prepared by the clients’ in-house, mostly make-shift, bookkeepers. Tim’s teammate – Scott – a CPA himself – had visited this client and found the books to be in a mess and spent a few hours “cleaning up” the database – and billed for those hours – to the horror of the Client !!
Tim believes that if he can charge the National average of $ 79 an hour for bookkeeping, while his firm will add to bottom-line, his clients would actually get the work done cheaper and better. And he is slowly reaching out to his existing clients to offer bookkeeping services.
If your firm’s major income source is from tax preparation, you want to read this further.
It has always been your concern how to keep cash inflows steady before and after tax season is over. Clients, however, have been “transactional” – asking for your help to file their taxes in time. That elusive “relationship” with clients remains mostly that – elusive. It’s been more or less similar for past few years and you want to change the situation. Generating extra cash flows beyond tax season seems so challenging. Yet, earning more beyond tax season has been one of the top 10 initiatives of many CPA firms. And how are they doing it?…..
You already have two great advantages:
You are already “connected” with the clients. You know them. You have worked for them. They know you.
You know their financials. You know their strengths and weaknesses. More often than not, clients are actually looking forward to you being their trusted advisor.
How do you convert these advantages into business leverage?
Engaging clients beyond tax season is one strategy that many CPAs are implementing. One option that is well worth considering is going “full service” by optimizing the economies of scale of collective strength of staff, technology and vendors.
At the same time, offering investment management, personal finance management, consulting services etc. is just the beginning. Leveraging existing network of clients, vendors, bankers etc. to create mutual benefits is on the rise. No wonder, the number of CPAs using LinkedIn, Facebook, Twitter etc. is increasing by the day.
It requires investment of time and effort before you sell valuable insights and advise to clients. For example, starting with “we noticed that last year you paid xyz amount in taxes, out of which x percent could have been converted into tax free expenditure to boost your balance sheet”… a client can be engaged into industry-specific business analysis and opportunities studies.
Reviewing clients’ business, their major sources of revenue, how do they find new clients etc. would give you an insight into opportunities for you to introduce relevant contacts to your clients. If you want to recognize the potential of your own network – just add up the total purchases of all your clients, vendors, advisors, contacts etc. That figure is just the beginning. If you have always felt great that you get new clients mostly through referrals, its your turn now to start referring business to others, regularly.
How does it help your business?
Transactional business is short on memory. People remember you only when they need you. But by referring regularly, you remain on top of their minds. You would be surprised how people will actually remember you at every opportunity they come across, not just when they need you. Growth comes from new opportunities. When you consistently and regularly interact with your network, new opportunities get created.
Where will your future growth come from?