If you have an obsession with costs, it could be holding your business back.
Simply by changing your mindset to think in a more entrepreneurial manner it will open so many doors for you, and your firm will explode with growth.
One of the things I have noticed within the profession - perhaps because we are numbers experts and deal with accounts on a regular basis - is that accountants and bookkeepers are very focused on costs.
Many years ago I heard this great phrase:
“You can’t cut your way to greatness.”
There is so much truth in that.
When you look at successful businesses and successful entrepreneurs, they think very differently to others. They have a very different approach to costs – they view them rather as investments.
Countless times I have seen accountants and bookkeepers complaining about costs of things such as software. They feel they can’t afford it, or are reluctant to pay so much money just for an app.
Everybody in the profession seems to be talking about business advisory work. And yet many accounting firms don't know where to start…
I recently came across an amazing success story posted in my Facebook Group, "Value Pricing with Mark Wickersham".
It's from an extraordinary accountant from Durango, Colorado called Zeb Smith. Let me share that story with you, and then we'll dissect it.
There are a number of learning points in this case study, and here are my top 5:
Are you working crazy long hours and making very little money?
You’re not alone.
The root cause of this issue is that accounting professionals are pricing too low because we are terrified of being rejected.
We hate it when someone says ‘no’ or ‘that’s too expensive’.
So, we make the mistake of giving a price that is low because we want the client to say ‘yes’. But when they do say ‘yes’ to your first price, it means you have priced too low, and left money on the table.
I’m going to share with you the concept of optimal pricing - it’s a better way of thinking about how to price and it’s the best approach to make sure you get the maximum amount of money for every job.
Optimal Pricing Works Like This…
The price for anything falls somewhere between your costs and the value to the customer.
But it’s not quite as simple as that because you want to make a profit,...
Do you ever go out to meet a new potential client and during the meeting you start to realise they are just a tyre-kicker, they just want the cheapest - those clients are a pain. My American students call them PITA clients (see if you can work out what that stands for).
When I started my accounting firm back in 1996, probably around half the meetings I went to were a waste of my time.
Our time is precious. Not Every Client Is a Good Client. So, how do we deal with these time wasters?
I’m going to share with you 3 strategies for avoiding tyre-kickers and PITA clients… (if you want to know a 4th, you can read this blog too: How To Pre-Qualify Clients And Avoid Time Wasters)
#1 - Positioning
Think about your website. Think about the wording on your website.
What is the message? Have you made it clear who your ideal client is? Or, like most accounting professionals, does the message say that you are available to everyone and...
If you have been working from an office, and now you are stuck working from home, the change can be pretty dramatic. But, not necessarily in a bad way…
When we adapt, we can benefit from a new way of working.
My business has been completely paperless for a few years now, virtual since 2014 and all of my team work entirely from home. I get so much more done when I work from home, and my team has never been more efficient either.
I would never go back to working from an office.
But for some businesses, not being able to walk over to your colleague with a question, go over documents together, or easily delegate tasks and keep each other updated on progress, is making productive work seem impossible.
So here are a few tips I have picked up over the years on keeping in touch with your team online so that your business can continue to run smoothly…
We Still Have Our Weekly Team Meeting
Every single Monday, all of my team get together for a weekly update meeting...
Do you want to win more business?
Of course you do, everyone wants more clients.
Well, one of the most powerful ways of doing that is to run events.
Why Should You Run Events?
The minute you stand in front of an audience, on a stage, straight away you are seen as being an expert.
When you are seen as being the expert, more people want to work with you.
You start to expose your message to people. You start to be seen as a thought leader. Just the act of speaking will help to encourage people to want to work with you.
But What If You Don’t Like Speaking?
Speaking in front of large crowds can be uncomfortable.
I’m an accountant. I’m an introvert. I’m not a natural speaker.
The first time I did a speaking gig, back in 1998, I was absolutely petrified.
But I found over the years that the more I did it the easier it became. This is true of anything in life, the more you do something, the better you become at it and...
Everybody in the profession is talking about moving from hourly rates to value pricing.
But people who are new to this journey, particularly people pricing services like bookkeeping and clean up work, all make a big mistake.
They try to move straight to value pricing in one big jump, and they get it all wrong.
I have seen people posting things like this on social media so often…
“I had a go at value pricing some clean up work and it went so horribly wrong, I just went back to pricing based on the hour.”
It makes me so sad.
The problem is, for compliance services like bookkeeping, moving all the way from hourly rates to value pricing is just too big of a jump to get right.
It’s too much to achieve in one go.
Value pricing compliance services conceptually isn’t easy.
Value is subjective. You can’t touch it or feel it, you can’t easily put a number on it. What is the value of bookkeeping work? What is the value...
When I ask my students what their marketing strategy is, very often they tell they they haven’t got one.
I understand them really because when I started my accounting practice in 1996, I didn’t have a marketing strategy either.
Very often we don’t have a marketing strategy because it seems like something that is really complicated and time consuming. After all, loads of people these days are getting marketing degrees and qualifications.
But sometimes people overcomplicate marketing.
I like to keep it simple.
Really, to create a great marketing strategy, there are only 3 things you need to do.
1 - Ideal Client Profile
Who is your ideal client?
You need to know who that is - in writing.
Look at your best clients. What characteristics do they have? What sort of clients do you like working with. What size business? What kind of turnover? What industry? Where are they located? What are their personalities like?
You need to...
Accountants and Bookkeepers are always asking me:
“What should I be charging as an hourly rate for bookkeeping?”
I get asked this particularly from bookkeepers who are starting their business journey.
So I decided to find out, definitively what the profession is charging. So let’s look at that. Also, later I’m going to share with you how you can get 30 days of free access to some of my best training.
Hourly Rates for Bookkeeping
I recently created the world’s largest ever study, with 2683 participants, into what people are charging for their bookkeeping services.
One of the questions I asked in the survey was:
“If you price based on an hourly rate, what is that hourly rate?”
This graph shows the findings…
As you can see, at the bottom end of the spectrum, there are accounting professionals charging as little as $19 an hour for their bookkeeping services. This is a ridiculously low price.
Bookkeeping is a highly valuable...
Tell me, what is your pricing strategy?
Oh, you haven’t got one?
Neither did I when I started my accounting practice back in 1996, and I made every mistake under the sun.
I didn’t have a pricing strategy, so the way I priced was crazy.
I Was Way Too Cheap
I wanted to grow my business, and I naively thought the best way to do that was to be the cheapest.
I’d deliver loads of value in meetings with prospective clients, then when they asked for the price I told them I’d think about it and let them know.
I’d ask for a copy of their last set of accounts telling them I would look for more tax saving opportunities for them. What I was really doing was flicking to the last page where it says ‘Audit and Accountancy Fees’, and checking what they were paying their previous accountant.
Then, I’d make my price LESS than the previous accountant.
In hindsight, this was totally crazy.
I’ve since conducted a lot...