What do clients pay you for?

Are you one of those accountants in practice, who still charges fees by reference to the time you spend working on a client’s affairs?

Even if you have moved to fixed pricing, menu pricing or value pricing you may still complete timesheets to show how much of your day has been devoted to each different client.

Thinking back to when I was in practice it was many years before I realised that a timesheet may have uses as a management tool but that it did not ‘prove’ how much time had been spent doing anything. It was a guide, nothing more.

After I left practice in 2006 I continued running training courses (very different to the talks I give now) and I asked accountants what they would bill in a variety of situations. The varied answers proved that the timesheet was simply a guide and that the ‘time costs’ that it reveals are rarely the same as the fees billed (or that could be billed).

A quick search online reveals that many accountants websites still assert that “Accountants sell time”. What nonsense. This is a sad misconception. It’s based on a misunderstanding and it’s misleading. Some accountants may try to determine SOME OF their fees by reference to time. They may try to charge fees by reference to their time records but TIME is not generally what accountants sell. If it were then the corollary would be that TIME is what people who want an accountant set out to buy. And they don’t.

In my view accountants sell (or should focus on selling) Trust, Confidence and Peace of Mind. These are 3 of the key qualities, if not THE 3 key qualities, that clients seek when they want to appoint an accountant. If prospective clients do not quickly trust you, have confidence that you will do the necessary, and gain peace of mind that they can rely on you, you will not keep them as clients; indeed they may not appoint you in the first place.

Yes they may have more specific needs – such as to prepare accounts, complete tax returns or resolve issues with HMRC. They don’t really care how long it takes you to provide your services. They just want things done. What do you think clients pay you for?

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How much experience do you have, really?

One of the 7 ways in which professionals can look to STAND OUT from their peers is through their different experiences.

Everyone’s experiences are unique. One of the keys though is to ensure that the way you reference your experiences is relevant to those who are hearing or receiving your message.  This is a point I often stress during my talks and mentoring sessions.

There is another related issue that few people discuss openly. This relates to the quality of their experiences as a professional adviser. When you claim to have built up, say, 10 years of experience, do you ever consider whether this has been truly cumulative or simply repetitive? Have you been building on what you know and what you can do, or simply repeating that first year’s experiences time after time over the ensuing ten years?

In some respects this is as much a question for prospective clients to ask before choosing a new adviser. It’s also one of the reasons why they might notice a big difference if they move from one adviser with limited experience (despite their years in practice) to another adviser who has built up a wealth of knowledge and experience through a varied client base that has prepared them for all manner of issues, challenges and problems.

Whether this distinction is important to you depends on what you do and who you look to serve as clients. Where clients want a pretty simple service they may well prefer someone who has done that for dozens or hundreds of clients over the years. Such clients may not be prepared to pay extra for someone with wider experience.

This is all quite distinct from the question of whether to focus your marketing on a specific niche. Although if your experience is quite limited then maybe you could reference this as a strength when pitching to prospects who fit the same criteria as your previous clients. Another solution could be to collaborate with someone who has wider experience than you – or seek out a mentor who can help you to fill in the gaps.

How much experience do you have, really? What is important I suggest is to be honest with yourself, honest in your marketing and honest with your clients. Also to know what is your back up plan if a client should require advice that goes beyond your experiences.  That, in itself, can help you to STAND OUT from competitors who are less trustworthy and who will found out eventually.

 

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Lessons for accountants from…. Coffee enthusiasts

During a trip to Cape Town I chanced upon the Espressolab in The Old Biscuit Mill at Woodstock. This is a fantastic little place where a range of bespoke coffees are also being roasted in a laboratory style environment.

When we arrived the owner asked us what sort of coffee we liked. I admitted I was happy with Nescafé instant. He was visibly shocked and, I fear, a tad insulted that such a novice had entered his domain. I realised I’d been a tad foolish – allbeit honest.

He asked what we’d like today and I said I’d chosen to try one of the half dozen specially blended coffees described on the counter. The coffee man asked me how I was going to TRY it? He continued. “These are coffees for connoisseurs”. He told me that if I had one of those I had to have it his way. Black. No milk and no sugar. I realised he wasn’t going to let me spoil, what he considered to be, perfection.

He told me that if, instead, I chose me of the specialist coffees listed on the general menu I could do what I liked to them. I took the point and had a cappuccino – with sugar! It was probably the nicest coffee I’d had for a long time.

What lessons did this bring to mind for accountants?

The manager exuded confidence, a pride in his work and passion about what he does. He didn’t set out to upset anyone but equally he didn’t pull any punches. He didn’t have much time for visitors who didn’t know or care much about coffee.

How do you react when you’re approached by someone seeking their first accountant?

Are you simply grateful they approached you or do you look to determine whether they will allow you to do your job properly?

They often don’t really know what they need. Do you evidence your experience and enthusiasm for the value you can provide so as to give them confidence that you know what you’re doing?

I wonder what would happen if you made your top quality (gold level) service something that you only allow serious clients to access? Others just get the basic service especially if price is their only criteria. Some may express interest in your all-round service with monthly management accounts and regular business review meetings. But you choose who gets that service. It’s not available to everyone. Only to clients who are evidently serious about their business. Maybe one day this new prospect will be ready for it. But not yet. Perhaps you might even create the desire that they want to move to a position whereby you will allow them to pay you more so that they can get your gold level service?

Can you see any other lessons for accountants here?

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