The importance of footfall

From modelling that we have undertaken, without a doubt, the variable that has the most impact on profitability is footfall.

Footfall in this context is defined as the number of times a customer passes your threshold – in a defined period – to buy something from you.

From a practitioners point of view they are the occasions when services are delivered, and the way to achieve an increase in footfall is to engage in a serious program of cross-selling.

What limits cross-sales?

Accountants like hiding their abilities. They wait for clients to approach them with a request for advice. They don’t want to appear to be too pushy.

This attitude is odd because it assumes that clients, by some process of divination, are aware of solutions that a firm can provide when many can barely articulate the problems they are coping with, that they need to solve.

By simply asking clients short, open questions, “how are you?”, “how are you coping with cash flow?” etc, accountants could quickly identify issues to which they could find appropriate solutions, and then offer these solutions.

Clearly, you would need to convince your client that there is some value in the advice being proposed, and that your costs are more than outweighed by the financial benefits or the personal benefits (being able to sleep at nights).

Leverage and footfall

Often, advisers will be able to broadcast a cross-sales opportunity to more than one client. For example, they could offer to provide a formal business valuation as part of the annual accounts review. In this way cross-sales campaigns can leverage additional services to many clients.

Test this process

We will shortly be adding a Practice Road Map calculator to the LandmarkPD site. When this is up and running you will be able to enter your own practice data and see how any changes to your practice circumstances in the past year are likely to impact your bottom-line results in the coming year. The calculator offers a number of what-if variables – one of which is footfall.

You will be advised when this facility is uploaded.

Whose back are you watching?

Professional advisers have an obligation to keep their clients informed of changes in, or the application of, legislation; and by doing this they also reduce the risk of negligence claims.

The cry of “You never told me that…” are words that advisers never want to hear and most practices have organised regular updates to solve this problem.

Broad brooms

Unfortunately, the cost of monitoring all clients to figure out which updates they will benefit from would be a time consuming process and one that most clients would be unlikely to pay for…

Which means advisers are obliged to adopt a broad-broom approach and as a direct consequence, communications sent in this way may not be read.

Filtering for relevance

One way to approach this conundrum is to make sure that we read our updates, pick up on the major issues, and select the key clients and prospects that may be affected. In this way we can phone or send a personal email pointing out the relevance of legislative changes and an invitation to meet and discuss.

Win-win outcome

In this way we can aim for a win-win outcome. Clients feel cared for and informed and firms have an opportunity to cross-sell solutions that may otherwise appear at some future date as a significant problem.

The process may involve the investment of time, but the outcomes will surely be worth the effort?

How Landmark can help

Landmark’s Fee Builder service points in this direction. It provides resources and implementation strategies that focus on these issues, tax and business development matters that would benefit from the advice you could give to achieve a satisfactory outcome.

During the winter period 2021-22, we are offering free access to all our Fee Builder resources issued in this period.

TAKE A LOOK>>

Budget forecast Oct 2021

The budget presentation on 27 October will be the second budget for 2021.

The Chancellor has already disclosed an increase in NIC and dividend tax to fund the NHS, both increases from April 2022, the so-called Health & Social Care Levy.

And let’s not forget the increase in corporation tax from April 2023. For smaller companies with profits under £50,000 the 19% rate holds, but then rises to a main rate charge of 25% on profits over £250,000.

If, as is expected, the Chancellor continues to plug the message that he needs to repay borrowings, what are the other possible targets for tax increases?

Inheritance tax

This is a fairly soft option for the Chancellor as the tax only impacts high value estates. The present exemptions are already pegged so will we see an increase in the 40% rate?

Capital gains tax

At present it is possible to convert income into capital gains and pay a lower rate of tax. A simple measure to counter this would be to tax gains as if they were income.

Another possible revenue raising option would be to remove the base cost increase to market value when a person owning an asset subject to CGT, dies.

Pension contributions

There has been speculation for some time now that higher rate income tax relief will be withdrawn or reduced to a lower fixed percentage, on qualifying contributions into approved pension schemes.

Freezing tax allowances

If the Chancellor decides to extend the hiatus on increases in tax allowances or the higher rate or additional rate income tax bands for income tax purposes, fiscal drag will mean that revenue from affected taxes will increase. This could create a significant increase in revenues in coming years especially if inflation continues to rise.

Impact on tax planning

We will have to wait and see what the Chancellor presents on the 27th and then reformulate tax planning options based on his announcements.

Landmark is commissioning a Budget Tax Impact Statement that will address these planning options, particularly for the tax year 2022-23. We will be making a copy available from our shop on the 27th.

Alternatively, readers can secure their copy free of charge by taking up our winter offer to trial our Fee Builder service, no charge until 1 February 2022. We will be adding the Budget Impact Statement to our Fee Builder dashboard as soon as is possible after the 27th. It will be provided in a Word format so you can add your own branding or edit our copy. We will also be including an update you can send to your staff and guidance how to make best use of the Statement with clients and prospects.

Sign up for the offer now >>

This is a great offer

Is your firm interested in shifting from pure compliance towards advisory services, but hits a brick wall when you try and sell advisory to clients?

Maybe we can help. The key, we believe, is to transition by offering advisory-led compliance options.

Fee Builder – resources to help you promote advisory services

Subscribers to our Fee Builder service receive monthly resource packs to promote specific services to clients. On each topic, we provide: client updates, scope and implementation advice and updates for partners and staff.

Fee Builder resources for the next four months

October 2021 – MTD for ITSA

Advising on the new implementation deadline and supporting affected clients – still recording transactions manually or using basic spreadsheets – to adopt suitable accounting software.

Outcome: expansion of basic compliance to include the design and review of real-time data and the potential to sell benefits of periodic management accounts, forecasting etc .

November 2021 – Budget Impacts on Tax Planning for 2022-23

Providing an easy to read Budget Impact Statement to underline future planning opportunities and other business development options.

Outcome: a lead-in to promote the importance and benefits of periodic tax and business planning.

December 2021 – Let’s Celebrate Christmas and the New Year (will be made available from 15 November 2021)

We are all in need of a little Christmas cheer this year. Resources for this month will include a refresher on the tax perks that are available to celebrate the festive period with colleagues.

Outcome: lifting practice goodwill and creating new leads; our client update will include a “feel free to pass this update to your friends and business colleagues” footer.

January 2022 – Tax & Business Development Planner for 2022

A list of the strategies you may want to offer clients in 2022 to reduce their tax hit and help them create and support business plans for 2022.

Outcome: start the process of adding targeted, development advice as part of your existing, compliance activity.

Winter Offer – October 2021 to January 2022

We are offering ALL the above resources, free of charge, if you signup for our Fee Builder Plus subscription this month (October 2021).

  • No monthly fees unless you stay on as a subscriber from 1 February 2022.
  • You can cancel your subscription at any time, no long-term lock-ins.

Simply complete our online order form to secure your chance to sample our Fee Builder resources with no financial risk.

SECURE YOUR FREE ACCESS HERE

Boris’s Budget…

In typical flamboyant style the Prime Minister delivered his very own mini-budget this week when he launched the new tax on income, the Health and Social Care Levy. Breezing over a broken election promise, to avoid tax increases, he justified the need to reduce the take-home pay for most UK taxpayers by citing the demands on government expenditure due to the COVID outbreak.

The 1.25% increase in National Insurance, morphing into the new Levy from April 2023, will impact all wage earners paying Class 1 NIC and the self-employed paying Class 4 NIC.

Employers may avoid any increase in their Class 1 employer contributions as this would still be sheltered behind the £4,000 Employment Allowance, but they will have to stump up for the increase to Class 1A contributions based on BiKs provided to employees.

Health and Social Care Levy

This Levy is a modern day attempt at a hypothecated tax. The idea is that proceeds will be directed at the NHS and social care budgets.

Cynically, it is another “soft” target for future tax increases. It is likely that this week’s announcement would have created more turmoil if the Prime Minister had announce a 1.25% increase in basic rate Income Tax.

It will be interesting to see if the transfer to the new 1.25% Levy from April 2023, will result in a return to present day levels of Class 1 and Class 4 contributions – as set out in policy paper on this topic – or will some of the increase be left as a permanent increase in National Insurance rates?

More red tape

When the Levy is introduced this will require changes in payroll software as the Levy will be shown as a separate deduction on payslips.

The Levy, as is National Insurance, remains a tax still administered UK wide, no regional variations. However, the Treasury will need to dole out an appropriate amount to the regional governments to feed into local health and social care budgets.

Effects on individuals

According to HMRC, the levy will be paid by employed and self-employed individuals earning above the Primary Threshold and Lower Profits Limit (£9,568 in 2021-22 tax year). In 2022-23 tax year an individual earning the median basic rate taxpayer’s income of £24,100 would be expected to pay an additional £180; and an individual earning the median higher rate taxpayer’s income of £67,100 would be expected to pay an additional £715.

A number of self-employed traders may also be encouraged to consider incorporation and adopting a low salary high dividend strategy to avoid Class 4 NIC charges.

Interestingly, individuals in receipt of property income as well as pensions income will be unaffected as NIC and the Levy are not applied to these income sources.

When the Levy is introduced, April 2023, wage earners aged above their State Pension age will be subject to this new tax charge.

A further tax increase for individuals will also kick in from April 2022, when the 1.25% increase will be applied to dividend income tax rates.

Told your clients yet?

Landmark distributed an update on the 1.25% changes as part of its Fee Builder services. If you haven’t taken a look at Fee Builder, we are offering free access to our Fee Builder resources and alerts, over the winter months, until 1 February 2022. If you sign up this month, you will have access to our client alert on this topic, issued this week.

Take a look>>

Purposeful business planning

As a practitioner, I have many conversations with clients about the value of business planning.

Over the years I have concluded that unless the client can see the reason or value of the planning advice, then – obviously – they are much less inclined to pay for this service.

The sort of planning I am referring to here is budgeting and period reporting to map progress towards defined goals.

Purposeful planning

I like to think that when I approach clients regarding business planning services I start by setting out the purpose of the planning advice; rather than a cold description of what is involved.

For example, clients who are looking at their choices as the furlough scheme comes to an end this month should really be drilling down into their crystal balls and figuring out what level of business they can reasonably expect in the coming year, the operating costs involved, other investments required what they need to withdraw from the business to support their own lifestyles.

Added issues will include inflationary pressures, supply disruption and so on.

This data will reveal staffing levels required and point to action that clients need to take. Otherwise, clients will be making critical and emotive decisions by sticking a pin in their choices map.

And when the primary purpose is fulfilled

If clients buy into this process, and you assist with the necessary planning, it is then a simple step into periodic reviews to make sure the business stays on track or takes fast remedial action if targets are not met.

Advisory-led compliance buy-in

In this way you can expand the value of preparing annual compliance accounts (or quarterly MTD returns when fully implemented) into a service that clients will appreciate has more than a prepare and file objective.

This approach has a clear win-win outcome for your practice and your clients. As you start to demonstrate positive outcomes for the advice you offer – for example, a plan to deal with staffing levels as the furlough scheme ends this month – clients will be more willing to pay for the ongoing support you have offered and will see the benefits or value.

Try this out in September

You can purchase the resources Landmark have created to support clients as furlough support comes to an end. Rebrand and send our update to clients or prospects that you know will be struggling with this issue. Even if any uptake of your assistance in the form of new instructions does not arise, you will be promoting your practice as advisors who care.

You can purchase our Life after Furlough resources here.

In recognition that we are approaching the busy end of the tax cycle for 2020-21 you can try out Landmark’s Fee Builder Plus service, that offers these ideas and resources on a low-cost subscription basis, with no financial risk. Landmark has a free trail offer if you sign up this month. No fees payable until 1 February 2022 and you can cancel your subscription at any time.

Sign up to FIVE month trial offer here or find out more about Fee Builder here.

Gatekeepers

If you employ a person to take calls for your practice you have a gatekeeper. If all your staff can take outside calls you have a number of gatekeepers. If you work alone, you are your own gatekeeper.

How do your gatekeeper(s) manage incoming calls?

Blockers

We all have calls from suppliers who would like to sell us their wares. In my experience – calling firms as a supplier – most gatekeepers will not connect to a relevant decision maker, they will simply request that information be sent in the post or by email to an info@ email address. From a busy practitioners point of view this is appropriate.

However, the problem with this blanket approach is that occasionally, the supplier will be offering something of real value value to the practice.

Clients calling

Clients present different issues when they call. They are not calling to sell you something, they are calling in response to an email or call from your office or because they have a problem or other issue to discuss.

Your gatekeeper(s) need to respond accordingly. A blanket “we will call you back” response may not be sufficient. For example, you could train your staff (and partners) to ask a series of open questions when clients call.

If they ask for a particular person it should be possible to ask “will xxx know why you are calling?”. In this way your gatekeeper should be able to figure out the degree of urgency involved.

If the client has received a threatening letter from HMRC or has discovered their business is running out of cash, a global response “will will call you back” may not hit the spot.

Missed opportunity

Panning for gold with your eyes closed will never make you a rich person. Gatekeepers need to be observant to spot those nuggets when they arise. Suppliers with products or services that may be of value to the practice, clients with urgent problems that need attention and quickly, prospects that should be called back asap to secure new business for the practice.

Gatekeepers should not be trained to block and delay communication with callers, but to filter calls.

Opportunity rarely calls twice.

Know your clients

What do you know about your clients beyond the data you collect to meet your compliance obligations, create accounts and file returns?

Will you remember that their eldest daughter was recently married or that they are struggling to cope with cancer in the family?

What should our relationship with our clients look like?

Memory may not be your most reliable source

There are certain facts about your clients that are easy to remember; their name, face, business interests and so on. But even those facts are subject to the flawed process we rely on, our memories.

The grey matter between our ears enables countless billions of connections. In memory terms, what we remember as fact can be a collection of random thoughts that bear some, but not an accurate, representation of past events.

For that, we need to resort to the written word.

Customer Relationship Management (CRM)

Most advisers store basic data about their clients in their choice of accounts, tax or similar software. Some of these options accommodate CRM, many do not.

It is possible to adapt Outlook or your preferred email provider as a way to record and recall past email conversations with clients. Unless you are rigorous in filing data, finding past conversations can be rather like recalling a client’s name when you bump into them in Sainsburys…

Even if you have a formal CRM system for your practice its effectiveness will depend on usage.

Being known

Personally, I am always amazed when a business contact remembers some long-past incident. It feels good to be remembered in this way. Your clients and other contacts will appreciate you recalling these details.

The way in which you recall is very much dependent on your memory or on the way you can access notes from previous conversations. In my opinion, it is well worth the effort.

Advisory-led compliance

In the coming months you will hear more about our ideas to start the gradual change from offering pure compliance services, to rewiring these accounts preparation and return services by bolting on a front-ended advisory element.

In this way you can gradually wean clients away from dedicated “grudge” compliance activity and get them to see the value in taking your advice.

Why worry? Compliance has been our bread and butter for years…

There are few practices that have not been affected as less qualified firms – with lower compliance costs – have started to encroach on this service market. They have lower costs and are prepared to work on lower profit margins.

Add to this the impact of the major players in the bookkeeping and accounts software market, and it should be evident that the days of relying on pure compliance services are leaching away.

Time to lift your head above the advisory parapet

Clients who are used to annual accounts and tax service levels, will no doubt react negatively if you suddenly try and offer advisory services “out of the blue”. Many are used to considering your services as something they are required to do, and they may have major concern about your cost.

Accordingly, they may not immediately see the benefits of advice.

However, just because you cannot see how you would ever get a reasonable number of your clients to appreciate and engage on an advisory level, does not mean this is a lost cause. Far from it.

What is advisory-led compliance

We are staking our claim to be one of the first practice development firms to promote the idea that you can merge compliance needs with the advantages of advisory services into a composite “advisory-led compliance” offering.

The two options are not mutually exclusive. Most practitioners will sprinkle their compliance conversations with advice. The issue is not your ability to offer advice it is more that clients may not appreciate that they are advised; or appreciate the value in that advice.

In the coming months our Fee Builder program will focus on creating advisory-led services that you could offer to your clients. The service packs will include easy to read updates that you can use to “convert” clients and prospects to this novel approach.

Like to be kept in the loop?

Don’t bury your head in compliance sands. Register now as a firm that is interested in this process and we will send you updates as and when we add relevant material to our Fee Builder library.

Email me now, bob@landmarkpd.co.uk, and register your interest.

Outsource – save time and money

Most advisers would recommend that clients who are strapped for time consider outsourcing tasks.

We recommend that accountants consider this advice and outsource basic marketing tasks.

What tasks are we talking about?

At a bare minimum, professional advisers should be undertaking the following, basic marketing tasks:

  • Inform clients of the advisory services they provide,
  • Send clients targeted alerts and reminders.
  • Send prospects alerts and information on a complimentary basis that will help to distinguish the adviser’s practice from competitors,
  • Keep staff abreast of practice marketing strategies.
  • Use these processes to update and push traffic to your website.

Using these simple strategies firms can then set up and manage social media campaigns using the content produced.

And the outcome?

If you could create and maintain this level of activity you should be able to increase prospect conversions and cross-sales to clients. You will also have staff, fully-informed, who are actively supporting your marketing efforts – now they know what this activity is…

How much would this cost if managed in-house?

Deciding on services to create and promote would probably take a major fee earner at least two days a month to research, document and write the relevant deliverables (updates for clients and prospects and monthly campaign material). At say £150 per hour this would amount to £2,100 per month – the cost of lost chargeable time.

Organising the delivery of updates and campaign material would take a £20 per hour part-time marketing person say one day a week or on average £560 per month.

Updating your website and managing social media campaigns would probably add a further one day a week of tasks for your part-time marketing person. Say an additional £560 per month.

In-house costs and lost fee income would be – on this basis – £3,220 per month…

How much would this cost if outsourced?

Landmark’s Fee Builder services provide weekly alerts and monthly campaign material to promote advisory services to clients and prospects, with updates for staff.

The monthly cost of the Fee Builder Plus option – which covers the above – is £55 plus VAT.

We are working on a delivery option for Fee Builder that will automate the broadcast of alerts and campaign material. Our price point for this add-on is presently estimated to be £100 plus VAT per month.

Other in-house tasks that would still be required are:

  • Reviewing content for distribution to clients say one hour a month at £150 per hour – £150
  • Updating distribution lists – two hours a month at £20 per hour – £40
  • Updating your website and managing social media campaigns – no change here unless you decide to outsource – which in both cases would cost approximately £560 per month.
In-house, outsourcing costs and lost fee income would be – on this basis – £905 per month…

Time to consider your options

Every practice needs to be stepping out and promoting its services; particularly those of an advisory nature. The days of relying on compliance income may be approaching a “mass-extinction” event.

Based on the assumptions we have made in this post, there appears to be an argument to outsource . Reductions in costs of almost 70% seem to be available.

Bob Edwards, Landmark’s Founder director, would be willing to discuss your marketing outsourcing needs and to explain what the Landmark Fee Builder service options could offer. Call any time 07879 896073 or email bob@landmarkpd.co.uk.

How would you feel?

Imagine that you are not an accountant in practice. Instead, imagine that you are one of your clients that wants accounts and tax sorted each year. A basic compliance package.

As a client, you can see there might be some value in having your tax affairs handled by a professional, but being required to prepare and file annual accounts seems like you are having to pay for help to obey the law.

These feelings of being the victim of red-tape only increases when you are told that any “planning advice”, tax or business development, is extra…

Your practice is facilitated by legislation

It is worth entering the world-view of your clients from time to time as this is the nearest you will get to objectivity; how you would feel if required to add costs to your business just to comply with red-tape, with legal requirements?

From your perspective, much of the work selling your compliance services to the business community is done for you. Legislation sets out regulations that demand an annual response to stay compliant; which means when you win a client you are winning a recurring income stream.

Your clients, on the other hand, have to market and sell in order to win customers. Most cannot rely on the need to meet regulatory dictate to create a market place for them.

The compliance advisory conundrum

Many practitioners have reported that their clients just want a basic compliance service and show no interest in buying advisory services. For some, this is a pragmatic reaction to your fees, which they see as a required cost determined by legislation, and one they desire to keep to a minimum.

Clients in this position will push at the boundaries, wanting free telephone calls or any other complimentary assistance they perceive as diluting the cost impact of your services.

We are entering a new era…

Perhaps advisers, being aware of these factors, could reshape their services and place their advisory skills at the top of their “this is how we can support you” services list, when they first meet clients as prospects?

Instead of offering a paid for compliance package, why not offer a business support and tax planning package and throw in the compliance aspects as free, no charge. This would position your firm as a much needed adviser rather than a “grudge purchase” bean counter.

Landmark’s resources will help you make this transition

At Landmark, we support this point of view. Our services, particularly Fee Builder and Spotlight, provide a wealth of development material and at low cost. Make a start on your practice transition today, take a look.

Safe harbour

Is your firm a safe harbour for your clients or are you just another vessel weathering the storm in open seas?

What do your clients need right now?

Aside from its literal meaning as a sheltered port, the word harbour is also used as a metaphor. In this wider context it is described as a safe haven.

Surrounded by sea walls a harbour is insulated from the worst effects of any turbulence on the high seas. It is a place of safety where ships’ crews can draw breath, relax and consider their options free from unremitting activity where survival is the only game in town.

Your clients need this space. They need to be able to stand back and consider their options one-step removed from the daily survival grind.

COVID challenges have been their storm for the last eighteen months; non-stop turbulence and disruption. What they need right now is an opportunity – perhaps with a seasoning of permission – to take a break and consider their options.

How could your firm meet this need?

One obvious way you could create calmer waters is to offer clients a meeting to discuss their options. We would suggest this as a first step towards providing relevant advisory services in the coming months. We would recommend that this initial meeting be provided on a complimentary basis, face-to-face if possible, perhaps an outside table at your local pub or restaurant.

The aim would be to offer an opportunity to discuss clients’ anxieties in an environment where those concerns are not in evidence. Suggest switching off phones when you meet. And ask lots of open questions.

If you can help clients reveal their problems you can start to consider how to create and offer solutions.

Any “pro-bono” costs of providing this opportunity will be more than offset by increases in goodwill, and who knows, your conversations may lead to the provision of additional advisory services.

Which clients should you approach with this offer?

Select your A and B clients for this offer; those that appreciate your advice and are usually willing to pay for it.

Don’t offer to clients who always want something for nothing and take an age to pay your bills.

Where do you turn for this advice?

Although finding a safe place to meet may be difficult until COVID restrictions ease, we are willing to speak with any practitioners who have concerns about the future direction of their practice following the challenges of the last year.

Pick up the phone. Bob Edwards – our founder – can be contacted most days on his mobile 07879 896073, or email bob@landmarkpd.co.uk.

Perspective

Do you have a choice about what you do during your working day?

Who drives this activity?

The clock is a merciless adversary

Language is rife with euphemisms that describe what most of us feel each day, that there is never enough time or that we don’t know where the day goes.

Is this true? Do we have no control over the clicking clock?

Can we interrupt the passing of time, no; can we stretch time, no; but what we can do is plan how we spend our time and this raises a question that all busy practitioners should consider:

Who is in charge of your day, you or the clock?

Victim or master of time

Most of us would agree that we are victims of time. After all, we can’t stop the clock. Which is true, but we can step back from driven activity to make space for considered activity.

“Considered” in this context should be read as reflective, taking time out to plan activity based on your goals rather than blindly attempting to meet the demands of the day.

If you can make this shift, even failing to complete tasks will point to solutions rather than leaving you with the feeling that you have failed to get stuff done. For example, if you really have too much on your plate would it be possible to delegate tasks?

Perspective

In a previous post, we discussed the value of stepping back from your normal routine in order to regain perspective. Reasserting your control over the ticking clock can help. Warning signs should be belting out if the voice in your head is telling you there is no time. A helpful suggestion here is that maybe there is no time because you are not making time.

There is no need to re-read Einstein’s second theory here. By making time read taking time out.

If you have ever worked out in a gym you will know that it is necessary to take a breather between routines. Taking time out allows you to stand back and regain perspective.

Try it for five minutes now…

Getting away from it all

I’m pretty sure that when our remote ancestors ventured forth from their caves in search of food, they were cautious. Food sources tended to bite back…

Now that we have “civilised” the food gathering process, leaving our homes should be enjoyable and most of us would agree with that sentiment, until COVID came along. Now we wear masks and avoid close contact with other human beings, who we are told, are harbingers of the dreaded coronavirus.

Traffic lights now control the booking of an overseas holiday in the sun; will we or won’t we have to self-isolate when we return home, including the risk of a red light change and the prospect (and cost) of a forced stay in a UK hotel?

Time to confront these challenges

Opinion is no longer divided, we need to get used to living with COVID. Vaccines will help and annual booster shots will become a common part of our health management routines.

If we need to work part-time from home, so be it. But one thing is certain, we are sociable beings and to survive we need to socialise. Whilst we all love our homes – well most of us do – there are times when we need a change.

Head for the beach

Whether we travel abroad or the UK coast it is time to pack your bags and get away. And there is a good reason for doing this – apart from saving our sanity – and that is achieving a measure of objectivity.

Back to the cave. If we never ventured outside the cave, aside from the health risks and having no food, the outside world would cease to exist. Our world view would reduce to rock on all sides. Once outside, we can see, objectively, that there is more to life than four walls.

Business will suffer

Aside from the very real disruption many businesses have had to cope with in the last eighteen months, taking a break from work will give you a chance to see the wood for the trees.

Ironically, we are all guilty of spending more time in our businesses than working on our businesses. If you physically distance your self from work (including your home office) you may regain some perspective on why your are in business in the first place.

And more on that question in my next post.

Unprofitable work

According to the 80:20 rule, we are spending 80% of our time looking after the concerns of 20% of our client base. Fine if we get paid for our efforts, but what if we don’t? What if we are busy fools?

Barriers to delivering profitable work

There are quite a few, including that you will have clients that:

  • are not prepared to pay for work with added value – advisory work,
  • don’t appreciate the value of the work you do provide, and
  • always want more for less – they consider your fees a cost not an investment.

To some extent this is a reflection of your willingness to accommodate clients, for example, by answering yet another call that you know you will not be paid for, and the current COVID effect; clients simply do not have the resources to pay for advice.

Strategies to counter this trend

Depressing as it may seem, the best way to deal with a problem is to realise you have a problem in the first place. If you are finding it difficult to expand advisory services – the profitable work – there are a number of strategies you could employ to counter this trend. For example:

Sacking clients

We all have clients that waste our time, don’t appreciate the work we do for them and are constantly seeking to reduce our fees. Surely the obvious solution is sack them…? Wouldn’t this free up time to complete more interesting work with clients who are prepared to pay?

Pro bono

If you have clients, good clients, that really can’t afford to pay for “extras” due to COVID disruption, would it not be sensible to offer a limited pro bone service for a short period of time? As long as you can see that by undertaking the work you can return clients to normality in an acceptable time period. This will sow good seeds in your practice goodwill patch.

The alternative is to stand aside and perhaps see- what may be a potentially valuable client – go to the wall. You will then need to acquire new client(s) to replace these losses, and the cost of acquisition may exceed the short-term cost of any pro-bono support.

Assessing risk

COVID has underlined the need to take a fresh look at your client lists and assess risk. For example:

  • Are they transactional, seeking to minimise activity to reduce fees or relationship biased: can they see the value of advisory services?
  • Are they bad payers, constantly seeking to reduce their accountancy support costs or are they good payers, appreciative of the work you do for them?
  • Are they survivors or will COVID disruption prove to be the end of their business ambitions?

Fee Building the Landmark way

If you are looking for ideas to make a positive impact on your efforts to build a profitable practice, take a look at our Fee Builder service. For a monthly investment of £55, this service will provide you with ideas and resources to implement fee building strategies.