Mike : “Bill, I need your help. My staff quit suddenly and I need you to help me with bookkeeping”.
Bill : “I am sorry Mike, but my firm does not offer bookkeeping services. You know, even if we did, it might have been very expensive for you”.
Why do accounting firms turn away new clients? Are these some of the reasons YOU turn away new business?………
Inadequate resources, manpower or time to manage new projects
Not enough automation
Inability of employees to handle multiple types of work
New clients and projects different than your firm’s core expertise
No outsourcing partners
New clients want baby sitting support
Your priority is to take only high margin / large jobs
Your waiting list is already long (lucky you?)
New clients not a right fit
Adding resources to handle extra workload is much more expensive than the income it brings
How Is She Doing It?
I recently met a very dynamic woman from Florida who owns a rapidly growing accounting services firm. She is adding new clients every week (yes, every week!) – all from her “reach out” program. Her success mantra : “whatever it takes”. She actively looks for help when her firm does not have a particular capability new prospect wants, reaches out in her network and gets what the prospect needs.
Reason to Turn Down New Clients
Questions to Ask YourselfInadequate resources, manpower or time to manage new projectsDo you have dedicated “onboarding” / “implementation” champion/s?Not enough automationWhy not?Inability of employees to handle multiple types of workIs it simply your confidence in them or is it lack of their exposure to multi-tasking?New clients and projects different than your firm’s core expertiseWas it your conscious decision to specialize in something or is it that you don’t have enough talent in your team to learn new skills?No outsourcing partnersTrading is the oldest profession and profitable. Can I trade external capabilities?New clients want baby sitting supportCan you provide them “turn-key” solution instead?Your priority is to take only high margin / large jobsDo you know ways to increase margins in small jobs too?Your waiting list is already long (lucky you?)Will the prospects wait long enough?New clients not a right fitJust because your firm does not have the resources/specific expertise?Adding resources to handle extra workload is much more expensive than the incremental new revenueCan you free up time of your existing resources – using technology, automation, integration?
Are You Turning Down These Jobs?
Over the last 12 months, Pransform interacted with over 500 CPAs across the country. Based on the feedback received from these CPAs, here is the list of “Top 5 Requests” new clients were making:
Bookkeeping: Many CPAs complain that clients’ books are in a mess and they take hours to clean them up – and many of those clients do not want to pay up for the clean up. Yet they keep turning down bookkeeping jobs. (Average 2011 National Hourly Rate for General Bookkeeping : $ 68 – Intuit Survey).
Back Audits: Last 2-3 (sometimes 7 or more) years of accounting data to be audited (mostly not-for-profit clients). These jobs are “detail-oriented”, hence time consuming – but have only “compliance” value – people want to cut down on costs when it comes to spending on past.
Software and Technology Consulting: New clients asking CPA firms for support / services to help them implement accounting software / cloud technologies has been on the rise. And while the knowledge about accounting technologies is good enough, the “tech expertise” required to implement projects is missing.
Asset Accounting and Management: A major concern for many manufacturing companies. Their managements want a “third party” to provide unbiased, real picture. Unfortunately, there are very few software applications that can do asset accounting integrated with tax impacts (hence the need for CPAs to apply mind). And, this again is a detail-oriented job; time consuming at least for the first audit.
Operations Consulting: Tell tale signs of operational inefficiencies are obvious in financial statements and accounting data. Cost-containment is a thriving segment of the market in which some firms operate. Cost-containment and policy improvement opportunities arise from operational consulting capabilities – the more you understand the client business, the more issues you can find in accounting data – not to forget the building of stronger relationship with clients due to more interactions. You just need time on hand to apply your expertise.
Market will pay what it can bear. Competition defines what the market can bear.
You can control two critical factors: your own “expert” time and your own costs.
Are you turning down new clients – new requests not mentioned in this article? Click Here to let us know. Our network of industry experts can suggest some innovative ways to make every new project profitable for you.