We all do things that we hope will help us to win more clients. Sometimes though what seems common sense to us may prove to be counter-productive – as the following story shows.
I was talking to an old friend, Helen. I learned that she had chosen a new accountant some months back and that he had given her plenty of his time for free so far. However she did not recall him making any reference to fees or the basis on which he will be charging her. She also hasn’t received any form of engagement letter.
Having had various very positive and helpful chats with the accountant, Helen has started to wonder whether he is suddenly going to sting her with a big bill for fees. He hasn’t started work on her accounts and tax return yet and she is thinking she will switch to someone who is more upfront about their charges.
Helen told me that she had found the accountant on the web and had checked out his website. The accountant had spent 90 mins with her as part of his initial 30(!) mins free consultation – and had indicated that he wouldn’t be charging for the additional time – he liked her and was interested in her business. He will tell her what the fees will be once he has seen her books and papers etc.
Is this accountant’s approach a good one to model? Lots of helpful advice up front. No charge for a long and valuable initial meeting. Making himself available for free to try to further convince the new client that he is ‘the one’. Sounds fine in theory.
Now look at it through the eyes of the new client – even before she spoke to me, I might add.
- What sort of a business brain does this guy have if he gives away 90 minutes of his time when he says beforehand the meeting will only be 30 minutes? Doesn’t his watch work? How confident can I be that he’s going to be able to tell the time properly when he records how much time he’s spent doing my books (or whatever)?
- What’s he hiding? Why hasn’t he told me how much his fees will be? If they were low and reasonable he’d have told me up front.
And so on.
One of the traps that accountants often fall into is the one that prevents us from looking at things through the eyes of a client.
I’ve often wondered about charging for the first meeting.
Cheers Malcolm. I think the key thing is to set expectations and then to operate consistently with them. It’s fine to have an exploratory meeting without charge but why would any accountant offer a free meeting during which they give away loads of free advice? It doesn’t exactly set the best of examples as to what is to follow does it?
I think the free advice is designed to persuade/convince the client to choose the accountant by showing off their knowledge.
Always a tricky one. New clients come in all shapes and sizes, so it is difficult to have a hard and fast rule.
If you work out how much it cost in advertising & networking time to get a potential client actually sitting in front of you, an hour of lost chargeable time is probably neither here nor there. And is it really lost ‘chargeable’ time or did it just mean an hour less on Facebook that day?
Helen already has an existing accountant, she is therefore I presume, an established business. She will have past year’s accounts and current records, these can and should be looked at during the first meeting.
The size of Helen’s business is also critical, she may be a freelance secretary with 12 invoices a year and a few travel expenses, or own a nuclear processing plant! A standard thirty minutes is therefore not sensible for all potentials. I also see the initial meeting as a ‘two way street’. I use it equally to assess the potential, to see if I actually want them as a client. Some troublemakers are easy to spot, others aren’t, so an extra hour may be time well spent. Thirty minutes is not enough for both sides to explain who they are and what they do and do they want to do business together. Why not just have a ‘free initial consultation’ and you the accountant chose the venue & length.
If the client has business premises I would advocate holding the initial meeting there. You can look at the set up as a whole and have a quick look at the records. I have found that some potentials ‘talk up’ their business and it is often simpler than they make it sound. The records on the other hand however, tend to be half as good as they make out!
Fee quotes are a skill. Even very simple cases where the client has to be chased repeatedly for every last piece of info can be very costly in terms of time.
The big worry with this case is the free advice element. It is hard not to give away something. I have never heard of someone being sued for wrong advice given at the free meeting, however, there is always a first time! It is possible to keep it generic and bait the hook with ‘have you thought about looking at incorporating/de-merging/using flat rate VAT, it could create a tax saving and we can take a look at the numbers and advise’. It gives the impression (correctly) that you have a bag full of good ideas at your finger tips without telling them how to do it for free.
The problem ones I find are the ‘I’m starting my first business shortly and…’ Sometime ago I was blown away by a stay at home mum’s business plan and ideas. The reality was even better, she could certainly teach many established businesses a great deal. On the other hand I have been shocked on several occassions by the naivety bordering on stupidity of senior employees setting out in a business of their own for the first (and potentially last!) time. And the ‘I have bought a nice pub now that I’m retired’ brigade, are usually in a class of their own for problems.
The hard and fast rule is, as always, there are no hard and fast rules other than common sense and of course, some you win, some you lose, but learn from them all!
PS to the above. Possibly the greatest sin committed here is the accountant’s delay in getting back to Helen!