I recently got an email from one of the members of the Value Pricing Academy.
She’d just attended one of my live webinars where I was sharing my own story about how, when I started my accounting firm back in 1996, I grew from 0 to over 200 clients in just a few years.
Here’s what she said in her email…
Today’s session was again full of great content.
Mark, you mentioned 4 prospects a week. Where I am located, I’d love to have 4 prospects EVERY month. Some months we get 4, then we go 2 or 3 months without any.
I am currently reluctant to do much marketing because of staffing issues. My fear is getting too much work and not being able to handle it all…”
I know exactly where she is coming from.
I made the mistake myself in my firm of becoming obsessed with winning clients. I thought that having a successful practice was measured by growth and being as big a firm as possible.
These thoughts are common because of the old-fashioned valuation model of accounting firms which is a multiple of GRF (Gross Recurring Fees). Very often, people buy accounting firms at a multiple of whatever the top line sales are.
We have this focus on top line sales rather than bottom line profits – we are too focused on winning clients.
Here’s the big problem…
You want to win more clients because you want more business, you want to grow and you want to make more money.
Then you find yourself getting very, very busy.
When you get busy, you automatically think you need to hire more people. Then what happens is you spend all of your time training new staff, micro-managing them and fixing their mistakes rather than doing the work you actually enjoy like helping your clients.
On top of that, you’ve increased your fixed costs by hiring new staff! You now have to pay that staff member and the payroll as well.
You may have increased your sales somewhat, but with the added costs your profits really haven’t changed much at all.
You’ll find you are working harder for the same money.
This ends up becoming a vicious cycle of trying to win more and more clients, and getting busier and busier without ever really increasing the profits by much.
I know because I did it myself!
In the first few years of my practice I was winning tons of clients, and hiring staff like crazy, but my life was a total mess!
The root cause is your prices…
Most accountants and bookkeepers are too cheap.
If your prices are too cheap and you spend all your time trying to get new clients at too low a price, you end up making a bigger problem for yourself.
You will get busier and busier, and you’ll never fix your profits.
Before you start focusing on marketing and winning clients, you need to get your pricing right.
When your pricing is right, THEN you can start winning more clients and making a real difference to your profits.
If you want to learn more about value pricing, I run a free live training session every month. You can attend live and ask me questions which I’ll answer for you there and then. Click here to register and I will send you an invitation to the next session.
And if you would like to join a community of like-minded accounting professionals learning to price more confidently and effectively, you can join my Facebook Support Group here.
Wishing you every success on your pricing journey.
Chartered Accountant, Public Speaker and Author of Amazon No.1 Best Seller, “Effective Pricing for Accountants”
Your Pricing Journey gives you access to my pricing training delivered every month in easy to digest, and easy to implement, steps.
So if you sometimes find yourself working too hard, for too little money, this programme will solve that problem.