In recent years, I’ve heard many accountants express concerns about losing valuable clients due to delays in responding to their needs. I have heard, “I am worried about losing good clients because we can’t look after them in a timely fashion.” For instance, one of my contractor clients shared in a meeting last week that it sometimes takes two to three weeks for their accountant to call them back. Ignoring client calls is a surefire way to lose business.
Accountants often fall into the trap of getting lost in a never-ending cycle of producing statements, conducting audits, and handling taxes, leaving little time to address the challenges within their practice. Many find themselves on a hamster wheel, struggling to make room for improvements. So, how can accountants make the necessary changes to their practice?
Living with the devil you know is not safer than having the courage to make lasting change. Where can you find the time to work on your business and not in your business? Less is often more when you understand how it works. The key is to work smarter, not harder. The 80/20 rule holds true in this context as well. Focus on the 20% of employees and clients that contribute to 80% of your productive work and revenue. It’s essential to identify which clients are most profitable and prioritize them. Would you rather have one profitable client instead of four unprofitable ones? The answer is clear.
To make positive changes, you must allocate time to address these challenges. Block out time on your calendar to focus on streamlining processes, improving client communication, and making your accounting practice more efficient.
Consider this from a business perspective. Just as low-profit clients impact your cash flow and require more resources to handle, the same applies to your accounting practice. Eliminate low-paying clients or adjust fees to attract higher-paying clients, allowing you to hire skilled staff and potentially work fewer hours while making more money.
The concept of categorizing clients into A, B, C, and D is nothing new, but the question is, what will you do about it? Raising fees and minimizing write-downs are effective ways to increase revenue safely. Transforming your accounting practice into a business model can bring positive changes and boost profitability.
So, take charge of your time management, streamline accounting processes, and foster effective client communication. Embrace these changes, and you’ll see your accounting practice thrive like never before.