The secret to growing a firm is successfully avoiding errors, especially those that can hinder customer retention and new client acquisition – the two issues that the accounting profession faces on a regular basis. Let’s look at the biggest mistakes most accountants make in practice management along with tips on how to avoid making them.
Failing to distinguish oneself:
The majority of customers for accounting and tax services are unable to differentiate one accounting company from another. These customers believe that all or most accountants are alike. Why? It is largely because most accountants are reluctant or unable to explain how they differ from their competitors. The design of accounting websites is remarkably similar. The common differentiator—price—is frequently used by prospects to choose those “unbranded” accountants. This results in practicing commoditization, which is not a long-term success strategy.
Ignorance of the customer, business, or industry:
The lack of customer, company and industry expertise by accounting firms are the main reasons why businesses terminate them. Larger businesses are not the only ones who experience this. Clients will vehemently disagree. Accounting professionals like the US CMA and US CPA should employ non-billable time to comprehend the client, the company, and the sector. The client would recognize their efforts and reward them with further work.
Not taking new initiatives:
The profession requires the collection and synthesis of historical data. This inherent tendency results in reactive behavior, which involves waiting for the customer to bring up a specific topic of conversation. Reactive behavior has certain drawbacks and clients might not bring up the matter or might be ignorant of additional issues that they should be aware of.
A trusted advisor always takes a proactive stance. The true worth of a US CPA is not found in “compliance deliverables,” but rather in understanding what the client wants, finding out where the client wants to go, and guiding the client toward the finish line.
Not billing for what they are worth:
The costs charged by a company reflect its belief in the value of its services to the client. The client will likely seek elsewhere if all the firm is doing is filing tax returns without any tax planning and submitting monthly or quarterly financial reports without any advice. On the other side, if they consistently deliver the value the client expects, the topic of fees is taken off the table. Firms must prove to clients that their goal is to work with them to achieve success. They have the right to charge more for their services because of this strategy.
Unable to create a referral network:
Attending networking gatherings causes a lot of discomfort for accountants. They frequently say they are too busy taking care of (too many) clients, but the truth is that they are uncomfortable doing it since they don’t see the benefit and it hasn’t worked for them in the past. Yes, networking can increase revenue, but it’s essential to think about how it will benefit the clientele of a business.
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