A Simple Sales Process for Accounting Firms

A lot of accountants think 'sales' is a dirty word. But the truth is that every modern accounting practice needs a strategy to convert prospects into ongoing clients. In this session, Ian will show you how you can set up a simple sales process from scratch, explain how you can qualify what prospects are a good fit for your firm, the steps you should take to turn them into paying clients, and how you can manage and automate this entire process.

Hello Everyone! Welcome to today's webinar. Appreciate you joining the time. All of this to you ... Brought to you by Intuit. Intuit Quickbooks. In addition, my voice in the front. My name is Ian Vacin, I'll go through a little bit about myself and I'm also from Karbon. So, if you need to check out just go to karbonhq.com.

Today, what are we talking about? So, for the next hour, we're going to be talking about a simple sales process for accounting firms. As part as the future content series. Again, you can learn about this and any other topics, by going to firmofthefuture.com.

For those of you who have been apart of the training journey, you may have been seeing us doing a bunch of road shows recently. All those training events can be found at qbtrainingevents.com. It could be coming to one of the more broader events from Firm of the Future. But, maybe you want to learn about Quickbooks online; that's what Fundamental Training is for. If you want to get certified, distinguished, and so forth, go to Certification Prep. And if you're already certified, the next step and last step of the journey is Advanced Certification. So again, all those things can be at qbtrainingevents.com.

Few things to note before we get started. One is, we're using go to Webinar, if you're not familiar with it. Please use the orange button at the top to expand or collapse the panel. Closing the apps, that might slow the connection down. And I'm joined here by my colleague, some of you might know her, [Andi Anchetta 00:01:34]. She is on as well. And she can answer some questions as we go through. And I'll try to answer them as we go. Not so great at multi-tasking, but we'll see how it goes.

Who am I? My name is Ian Vacin, I'm a Co-Founder and VP of Product Marketing at Karbon. My email is down there below, so is our URL. I've been in the industry for 15 plus years. Technology industry over 25. And I used to work at Intuit, for almost a decade, leading their Pro Advisor Firm ... Pro Advisor Program as well other different departments across the Quickbooks franchise. On the Karbon side, again there's two things. One is if you want to learn about more, go to firmofthefuture.com. For Karbon, if you want to learn how to double your firm, or extension of the topic we're talking about you can check out karbonhq.com/editions, to learn about topics like this and some others. If you want to learn about Karbon; we're not going to do that today. It's the practice growth engine for accountants. And you can go to karbonhq.com or events.karbonhq.com to be able to learn how Karbon brings together all of your work. So, you can see what needs to be done, what does next, bringing in your email, your contacts, your work, your checklist, your tasks; all into one place. So, you know what to do. And you what everyone else is doing all in one place. So, again if you want to learn about that go to karbonhq.com.

However, we are talking about a simple sales process for accounting firms. One more piece, before we get into the topic is if those of you looking for CPE. There's 1 CPE credit up for grabs today. I will be giving a slide that has a key word on it. You need to note what that key word is, and I will pull at the end of the webinar today, for what that keyword is, and therefore you can get credit, and get your 1 CPE credit.

All right, so, let's talk sales. How many of you, and again I can't see the virtual hands, woke up one day and decided you wanted to be sales and marketers? Most of you, probably not so much. You wanted to work as an accountant, or as a bookkeeper, as an EA, as a CPA, whatever it may be; but it probably wasn't sales, and it probably wasn't marketing.
 

So, the good news is, is that 64% on average, of new clients in accounting firms today is due to referrals. That meets 2 different sides of the equation. One is, it is a referral based business. The majority of what you're going to get is referrals. And again, I've done talks before, you can go to firmofthefuture.com to see it, in terms of how to do the best referral marketing out there overall. Another reason for why that number is as high as that is, is that there really is a low bar for sales and accounting. Which is a great thing, because you're at this webinar today. We can help give you some easy quick tips and tricks about how to do it and how to do it at scale.

So, one of the first pieces are; and we're going to talk about as one of the first key steps is around targeting. Sales and marketing are driven primarily about how narrow or focus that you have, because that's going to increase your ROI, and it's going to increase you're probability to close. And so most people out there don't really have a target approach, and that usually leads to well outcomes inside of sales and marketing. The second one is when people talk about marketing, specifically, and needing leads into a sales funnel. They generally just focus on inbound marketing and the reality is, is just really around website redesign. Which is a start, but it's not sufficient and it's not necessary again if you're going to want to be doing this afterward. And the last one is, rarely do I ever see anyone doing outbound marketing. And we'll define what outbound marketing is a little bit later. But, a quick example is, you picking up the phone and calling someone to sell your services. That's again, telesales, not necessarily what you need to be doing, but again, that is an example of outbound marketing. So, we rarely ... And again I've met with thousands of thousands upon practices over just the last year alone, rarely do we see this happening.

Now, when someone does go down and decide that they want to get on the sales route; the typical path that we generally see is, they go higher someone that's called a Business Development Manager. And generally that's from a marketing stand point. And they're probably ... A lot of times they're not a sales and marketing expert, or well experienced. They may be experienced on one side, but not both. And generally what they're doing is, they're going and looking at the website, redesigning it, and then they're going to focus on the referral marketing side. And so, that's the typical path, and in my opinion, well it's the bare minimum, it's not sufficient.

So, with that being said. For today's 1 hour topic. I've broken it down into 7 steps that we're going to talk about. The first, and most important is you got to know who you're going after. Because it's going to change how you market. It's also going to change your sales conversations inside and out.


The second step, it's about measurements. You do this with your small business clients. You talk about how you're going to be looking at how the business is performing. And on a sales function, it's really, really, really, key to understand what you're trying to achieve, how you're achieving it, and how you're improving on that day in and day out. And especially, if you're going to be hiring somebody for instance to working on the sales or marketing pipeline; you need to know who that pipeline is performing, and what activities are working and which ones aren't. Because marketing can get expensive; and sales people will generally find the best way to increase their own incentives and it better be inline with what the businesses incentives are overall.

And step 3, we're going to talk about structure. Again, how do you structure organizationally. You're marketing and sales functions.

Fourth, we're going to talk about infrastructure. And so, what are the tools that are people using. And what are the processes that you need to put in place. Again, we talked sales process here in the title. We're going to get that in step four.

Step 5, we're going to talk about the inbound star-, marketing side of it; because that's what going to feed your funnel. That's got the lowest cost to it, and should have the highest probability to close

Then we're going to talk about outbound. Which we mentioned before is not we're not most people are focused.And then lastly, it's about scale. So, how can you scale up?

Step 1, how to target. Now again, if you go to firmofthefuture.com, I've written articles up there already about how to target. So, I'm only going to go though this a bit briefly. And you can go ahead and reference those materials there, if you want to have more interest. The quickest, easiest way to understand who best to target overall and what segment is ideal for you and for your firm; is think about what your passionate in. Sit back, think about the 10 or so clients that pop front and center in your mind, and think about which ones when they call you get most excited about. Now, look at those that, you might have several that pop to mind, you want to then understand what about those firms makes you passionate. Is it the type of work that your doing? So, the services that you offer. Is it the markets that they sit in? Is it an industry? Is it the characteristics of the owner? There's different ways to look at it, but the first step to really get an idea to where to focus is really, just what your passionate about.

The second one, is to actually look at your clients. You should all be using and scoring your clients, based on the promoter scores. See how satisfied they are with your services. Again, you can learn about the promoter online or go to Firm of the Future. But, looking at which ones are satisfied and which ones are you promoters, you can dig into those ones and figure out, why are they so satisfied. What is the commonality that exist across them. But, ultimately, we need you to narrow down or focus on a particular segment.

Vectors of similarity. Vectors of similarity are industries, technology savviness, willingness to pay perhaps, the functions or size of the business, complexity, the revenue sides of the business. There's different factors that you might want to look at. But, helping break down which customers you do best with, which ones your the most passionate about, and which ones have the best ROI. And what you then do, is you take those 3 inputs at the start, you look at them and arrogate together, and then you start to narrow it down until you get to a point where you actually have a niche. There's both the qualitative and quantitative way to do about it. Again, go to firmofthefuture.com and you can see about it in detail. But, what we're trying to do here is to find a narrow target, by which we can direct our marketing and our sales efforts in order to find the best fluidity through a marketing and sales funnel. And so, that's the starting point of everything.

That's going to lead to step 2. So, step 2 is about setting up the right measurements, before you're going to go and start doing a lot of effort on both the marketing sales funnels; and then what you're going to monitor in ... While it's all moving forward and while you're doing different initiatives.

I put up here a quote. Every good presentation should have maybe 1 quote, probably not 2. But, Peter Drucker's, the godfather of business processes, business management, and I think it's a good point. "If you can't measure it, you can't improve it." And that's the whole point here. You're sales processes need to be improving day in and day out. If you're starting out and you're doing 90 days to close a deal, you want to may be have a goal 60 days. And when you get to 60 days, you want to have a goal of 30 days. But, it's trying to ring out all of the extra time, and as well as being able to improve the probability of each particular opportunity that comes through, your sales pipeline.

So, how can we do that? So, I brought up here a bunch of different measurements overall. You should be thinking about your particular practice, like a tech company today thinks about their saas business. And so, these are what I would call accounting as a service, metrics. And again, non of these are really foreign to your overall. Looking at revenue, looking at margin, gross profit, looking at churn. But, then looking at some of the more interesting ones. How expensive is it to acquire a customer? What's the lifetime value? Again, we're moving to monthly services; you should be again advisory services, and bookkeeping, and accounting services, and those should be on subscription basis. And saying you need to be looking at things more granularly, so month over month growth, revenue per employee, and so forth. So again, the high level metrics that your going to give you a sense of the business overall, and your practice overall. Just like what you advise your small business clients.

But, then some of the ratios come a little more interesting as we look at accounting as a service. Again, looking at lifetime value, what a cost, in relationship to cost to acquire. A quick ratio, we all know that. The saas magic number. Again, it should be accounting as a service magic number. Again, if you're not familiar with that, just search on Google and you'll see what it is, and it'll give the threshold as to what's good and what's not so good. Always, knowing what you're best and worst accounts are. What are your ... Looking at some of the productivity metrics, around staff activity. And then around efficiency task and work insights. And those are a little bit more individualistic on the practice.

Now on the sales side, overall, and on the sales measures, these are the ones that are the most important. What are the closure rates? When you have an opportunity, what are the counts of your opening, or closing? It's all about quality and qualification, so what's the percentage in terms of fit? What are the size of opportunities in terms of dollars? Maybe you might want to look in terms of employees. When is each one expecting to close? Because you want to have visibility of your pipeline; that's critical. You need to know, when exactly each deal is going to close, because you need to make sure you can service it with the staff you have on the back end of it. And then your average time to close. How long does it take to open up an opportunity and to close it at the end of the day? We're going to look at numbers later, but on average inside most accounting firms, that average time to close should be 30 days or less. But, again I'll give you some best practices and some numbers a little bit later in the presentation.

So, now we've got a focus in terms of where we're going to focus our efforts towards in terms of a niche. Now, we've got some metrics to look at overall, to see kind of how we're doing. Now, it's going to lead to what is the proper structure for success.

I've talked about this before, in terms of how most organizations are designed... Most practices are. And they're usually vertical, or they're horizontal, or possibly hybrid in between. I put up a graphic here to kind of show what that is. And that's because they're mostly designed in terms of, how do we get the work done. A vertically oriented firm, is headed up by a partner. Who then has a group of specialists ... Let's not say specialists/ A group of individuals that are more senior, typically. That can be able to service a client [holistically 00:14:46]. So, then they may have had ... They may have had a focus in accounting, but they can do bookkeeping, they can do advisory, they can do what not. And generally, that person is sent to a particular client, or manage a particular client and they're wholly servicing that client, overall. And there scale about how big those firms can get, but basically you got a pool of resources that you can attribute to any given client as you need.

Versus a horizontal firm, which is generally what happens to firms as they grown larger and larger. You then get a specialization that occurs. So, you then get an accounting departments, and payroll, and tax departments, and the work isn't managed by an account manager. It may be managed by man. There might be a man that oversight over each one of those departments. And their work varies from department to department, in order to service the client, as their needs are. So again, if I'm doing advisory tasks, accounting, or bookkeeping, there may be 4 underlying departments, that do the work and it's managed by one account manager. But, here's the problem. It's great for getting the work done, but that is not conducive for how sales and marketing function. It is not necessarily one of the people that listed in that organization structures job, in order to do sales and marketing.




You need to run your practice like a small business. Now, you may have that vertically, or horizontal, or a hybrid of the 2, in order to service clients, in order to get the work actually done. But, you need to have the competency and the capabilities to do your own finances, to do your own operations work, to do your own sales, to do your own marketing. So, you need ... And maybe even social marketing, I don't know, we have an intern that does that. But, again, just like you would advise someone else, you want to be able to have a proper sales, or marketer, or a combination of the 2 focusing on that side of the business. When it first starts up, that might be you, that might be the partner or the owner. It might be the firm operations or administrator. And then it may become somebody who's dedicated. So, it really depends on where you are in the cycle of things. Generally, it is a function of the owner to be focusing on the sales. And as that's well understood and the metrics are driven and understood, then you can bring in somebody that you're going to have this be their day job, as you move forward. And as you as an owner, you may be stepping back then and just doing the work on the close and any of the given deals.

So again, run your business as a small business. Have the particular functions you need in order for it to be successful, across both getting the work done but also bringing in the work that you need.

Let's talk a little bit about the sales and marketing resources that you need. The first one that we mentioned before is that most people go out and hire, what's called a business development manager. And it's generally in terms of focusing on the marketing side of the equation. This might be a good starting point; however, a sales person and a marketing person are generally very different. They have different ways of thinking about things, and most marketers don't make good sales, and most sales don't make good marketers. So, that may be a starting point, but that business development manager, might need to be moved into being a dedicated marketer. Or working on [bus dev 00:17:55] in general. But, not necessarily in service of sales.

When hiring in sales, what we find, and for practices overall, if you have an ability is to hire 2 sales people at a time. The reason for that is, sales is very competitive. And when you have a single person working on it, it's harder for them to be motivated and it's harder for them to have that competitive nature come out. What some people will do is they'll take the sales people and they'll bring them in twos, and they'll have one with expertise and the niche of the target market that their going to. It might have been a client that they had in that area before. It might have been someone who's worked as a small business owner, or has had some experience in working that vertical niche, for instance. And the other person is a trained sales person. Might be younger, but it might be a sales person. And what that allows you to do is cross pollinate the 2 in order for the sales person to learn more about, understanding the small businesses that you serve and how they operate and what's unique about them. While the vertically ... The vertical expert, industry expert, or the prior business owner, or client that you've had, can learn the necessary sales capabilities and processes in the like. Therefore, you're able to get this next cross pollination.


When you have, generally the ratio that we see in firms is a 2 to 1. Meaning that whenever you have 2 sales folks, in this case what we call SDRs, Sales Development Resources, or Development Reps, you're going to have to need to have 1 account manager. Now, if you're just starting out that account manager is usually the owner, or it may be the operations person. As it gets broader and broader ... We've worked with 1 firm who had 16 sales people. So, when you start to scale that up and gets bigger and bigger, those sales people are going to ultimately report to an account manager. Who again that's the person who's able to close deals. And that account manager reports up to the CRO, or the firms operations manager and then that person reports that to the partner or owner. So, that's kind of how the structure breaks down.

When hiring, again sales folks are definitely for some folks, more of a challenge. There's 2 different mantras, that I ... Again, this applies just to hiring in general. But, you hire for aptitude, and you hire for attitude. Attitude being, in my opinion the most important. Aptitude in terms of whether or not they're able to do the type of job that you have.

The second mantra is, you hire for passion, you train for skills, and you fire for example. And what I mean by that is, again, just like before on attitude, you cannot train attitude. You cannot train passion. You either have it or you don't. And if they don't have it, they're not the right fit for you. You can, however, train for skills. So, if you have the ability ... If you have some capability here, and you know who to do it, you could take somebody and train them into the sales skills that you need. And then, again, especially for sales, if it is not working out, you need to get rid of them as fast as possible. So, you're firing for example for those other folks that are out there, so they know again what performance should be and you're measuring along the way. But, it might ... If it's only 1 person again, you need to get out the deadwood and bring in somebody that's going to do the job correctly. The longer that you have that in there, it's going to [fester 00:21:24] overall in the organization.


I highly recommend, again, most people that are listening to this webinar today are not sales people. So, hire someone that has experience. And experience can be of 2 sides; the target market that you're operating in, or again the sales expertise that you need.


If you're early on in the journey, contract. It's going to be cheaper for you. It's easier to get a contract resource in and out; than it is, again, if you're not sure what you're going to get. So, even if you want to go down a contract to hire scenario, again, I would urge you to do that early on to understand what the pipelines going to look like. What the right resources going to be. Again, it allows you to test the water without all the other baggage that comes with it.


And then in the firm overall everybody needs to have a sales mindset, and always be closing mindset. The sales person definitely has to have it. You as the partner or the owner, or within ... You might be managing clients overall, you have to have it. Again, every conversation has a possibility to be a close of a sale, an up sale, or cross sale opportunity. So, even if you're the one servicing the client, you need to be looking at, where can we be doing more business with this particular client. What do they need? How can we address it? And making sure that conversation is t'd up, so that you can move forward with doing more. It's cheaper and easier doing more with the clients that you have, than to go find new clients to fill in the gaps.

Now, we've talked about the people part of it, now let's talk about behaviors and compensation

First is, you must realize especially with sales people, they're always going to maximize their value in the equation. They're driven by money. They're driven by success. They want to close the deal. They're going to figure out how to gain the system, however it's been put up. And that's their job. Their job is motivated by the compensation package. They're motivated by what their firm is trying to do, and it's not a bad thing. But, you need to be very careful and smart about how you align incentives and how those latter up to the goals of the organization overall. So, just note that that exists.

The second thing is, they need to be compensated, and that compensation needs to be able to satisfy the basic needs that they have. So, this is just like the [maslow's hierarchy 00:23:59] [needs hierarchy 00:24:01]. You got to be able to live. So, running off of a fully, variable, incentive driven compensation isn't going to work for most people; so, there's going to be a fixed component and there's going to be a variable component.

Now, what do we see? Best practices right now from what we see and from those who have had the most success, we see what's the 70:30 model. 70% fix, 30% on a variable model. So, I'll go through what that variable is here in a second; but, again that's roughly how the breakdown is translating. And the salaries are ranging anywhere from $40-$100,000 a year. It really depends on where you're located, what target you're going after, the dynamics of the local market. So, that's why it's a pretty varied base. It's also, again, the seniority of the resource that your getting. Again, I think that's broad, but again it really depends on who you're going after and where your situated.

Now, on that 30% variable side of the equation. 70% is fix, 30% is variable. What we typically see in best practices is 50% of that compensation is paid on opportunities being opened. And those are qualified opportunities. So, having a target, with that might be, maybe it's 1 a week, maybe it's 10 a week; it really goes into what the fluidity of your sales pipeline is when that persons coming on staff. Generally, that's why we say it's good for you to play in sales beforehand, to understand what sort of capabilities you have to bear; and then revisiting those targets over time, because there going to generally keep improving if you're doing the right things. But, 50% is on the open target and then 50% is on those opportunities closing. Now, I mentioned before than on average we're seeing about a 38 day turnaround from open to close. So, there is a separation from when someone comes on, they're not going to necessarily get that 15% of that ... Half of that 30% variable model being paid out in month one. Again, it's going to go out based on how fast your pipeline's progressing through.

And the last thing is ... The last thing of the equation is let's not forget the up sale part. So, this goes back to the conversation before, everyone should be selling. Now, we've seen, again, the sales person may not be involved with the client after they've come across. They maybe by involved, they may be brought back involved if a cross sell or up sell opportunity is identified. And you want to make sure you're [incentivizing 00:26:51] all your staff to cross sell and up sell, based on working with the client day in and day out.

Now, we've seen, again, this is where people have gotten creative, and it's really a right for me sort of strategy. Some people will give a residual on the service work that is done. Residuals are very dangerous, so note that. Others have given a one time spot bonus, in terms of if their client ... In a type of percentage of the services. There's other ones in terms of maybe they're in terms of there's some of their compensation is become variable on how much they can cross and up sell. It really depends on your ... What you're trying to accomplish out of it, and how involved your people are within that sales process. Some people will split whatever the incentive is, between the sales person and the person who's doing the work; so that way that they partner together, when an opportunity is identified. So, again it's how you're going to manage the sales process overall.

As I've mentioned before, this is a CPE credit worthy webinar today, and our CPE keyword is woodpecker. Again, for those of you looking for CPE; our CPE keyword today is woodpecker. Nice little picture there. Appreciate Wendy who gave this to me. Again, I'll do a pole at the end for that CPE keyword, that is woodpecker.

Moving on, again we ... Title at the top was about the process, so now let's ... We've talked about our target, we've talked about our metrics, we've talked about our structure, we've talked about hiring, and compensation; now what's the process that we're going to follow and how do we support these people with the infrastructure that we're going to need in order to properly do sales.

Let's go first with process. At the end of the day, if you don't have anybody to reach out to, talk to, or contact, that didn't really hep the sales person overall. So, part of that is marketing driven, part of that is sales driven. You're going to be spurring your activity. You're going to be bringing your volume that your going to try to process through on your referral marketing activities, your inbound marketing activities, which for most of you might be the website, but it might be search engine optimization, there might be other activities I'll explain later, as well as your outbound activities, that could be advertising, that could be your events plan, that could also be outbound calling as well. Those are the things that are ultimately creating the needs that you need in order to generate opportunities and then closing the sales.

Each one of these leads that comes in, must be qualified. You need to make sure that if somebody's calling in and it's not a marketed ... Let's say you don't address non-profits. It's just not something you do, you're not set up for success on that. You need to be able to identify that, this person is a fit for what you do or it's not. And if they're not, you need to move on, because you need to have your sales people focused on the opportunities that can close, in order to maximize the benefits and the ROI.




Now, their job when they're able to get a lead, is they ultimately want to get them on the phone or a video conference. Going back and forth on email, is slow, it takes time, doesn't drive a relationship, and ultimately doesn't lead to the best sales outcomes. So, they want to be getting to a conversation where they can promptly qualify, and that qualification is on the opportunity size. What type of services are we talking about? Over what duration of time? What's the willingness to pay? How much budget does the client have? You got to ask for what their budget expectations are, because again, if they're not willing to pay then it's not worth your time. Time and time again, people will not ask for that and again you can cut a conversation short and quick on knowing that they're looking for the cheapest firm on the block, and that should not be you.

Next, is really around fit. Do they fit in terms of how you guys operate; the processes you have, the top technology stock that maybe you're using. And then they need to be prioritized. If it's a hot lead, big opportunity, fits perfectly, it goes top of queue. If there's some question marks about it, you need to focus on the ones that are going to drive to finish the quickest, and move the other ones further down when you have more time spend.

The next is, in that process after qualification is driving that conversation. This should be almost in the same conversations. But, it may be a follow up conversation, which is finalizing the scope of work that's desired, having the valued conversation overall, explaining what you do and how you do it, explaining the services that you provide and narrowing it down to, again, if you're doing packages and your serving them up, which package is right for them, and any sort of modifications around that. Because in sales, you're trying to make sure that you drive to a signature as fast as humanly possible. And that's what step 4 is.

The process is to drive to a close. In a larger sales organization, this may not be possible to drive to a close, it may require an account manager or the partner to be able to have that conversation to sign off and move forward. In small organizations, those people need to be empowered. And it may be you as the partner or the owner, or the person who's handling the operations. Then you're making the phone calls, in that case, you don't want a time line. You want to drive to a signature. And we're going to talk about even technology for that. Again, you want to get the proposal done, and maybe you're going to use a [inaudible 00:32:32], do the proposal work back and forth, leading to a signature. Maybe you're using [inaudible 00:32:37], maybe you're going to use something like DocuSign. But, again you don't want ... You want to limit the wait with the lag time that exists between any one of these steps, to get to an immediate signature.

The next thing is, if you do get a signature it's minimizing the onboarding time, because that's also a risky avenue; and you want to make sure you schedule you're follow up meeting immediately upon the close of the deal. Every task you complete, the next task needs to be immediately scheduled and put in place. Get a signature. Don't ... Whether it's a handshake, you immediately want to follow up and get that signature. One it's on paper it's a commitment. If it's just a handshake, a lot of things can go sideways. So, use technology as your help here. But, again, try and get the lead, quickly do a qualified opportunity, get the scope of work, drive to the close, get a signature overall.

So, you're close rate overall is completely a relationship around how many steps it takes to get it done, how much time happens between each step, whether or not the client work was understood, and any generated friction that exists between you and the client to get things to move forward. You want to be eliminating the friction. You want to be limiting the steps to finalize what work needs to be done; and you want to be eliminating all the time that happens between conversations, or even within a conversation to getting an alignment of what we need to have done, in what time frame, and how we're mutually going to benefit from this.

Now, on the other side of this is you have to have visibility of that sales pipeline in regards to what you do and how you do it, because you got to have the capacity for fill on the sales that are brought it. You don't have an infinite amount of capacity. I urge all of you to go underneath, [Ron Baker's 00:34:21] advice of running your firms at 85% capacity. Because if you got a hot deal that comes in and it's going to bring in a lot of money, you can't necessarily cut the service of your existing clients, but you want to be able to bring that in. And that extra 15% of capacity that you have can be used in order to fine tune your business overall, prove your process improvement, do cross sell, up sell opportunity work in terms of trying to find that. So, again, you can use that capacity for really good benefits for your firm. But, again, for capacity planning you've got to have visibility to the number of deals in the pipeline, when they're going to close. What the quality is, so that you can make sure that you are making sure the best deals go through, they close when they need to close, and you can service them immediately. Or at least how you described with the client overall. So, that's the process.

Let's go through a little bit more in depth around some numbers, some tips, and some tricks overall in regards to that process. First thing overall, is what are the numbers to note. Those that are doing sales, and have a proper sales function, are generally getting something between a 50-75% closure rate. And partially, that's because a lot of the leads that are coming in are from the referral side. And referrals have a high likelihood to close, because they've already been vetted. They've got someone who's already been endorsing them because it's coming from somebody that they know. Therefore, it's about having a great value conversation and then limiting that time line that exists between steps.

Now, in terms of creating opportunities overall and opening opportunities, the open rate of opportunities based on an inbound and an outbound marketing funnel waiting to sales, is generally around 25-50%. You can inflate that number by having poorly qualified leads, but again, when you have a properly qualified lead scenario, you should be knocking out at least half of those people coming in, because they're just not going to be a fit for your business. So, a healthy area to be in is at 25-50% in terms of open rates. On average, most people that are closing, are going from an open to a close within 30 days, best-in-class is 1 week. 1 week means, you've got an opportunity that comes in, you pounce on it immediately, and you're having touch points possibly once a day.




It's taking ... and I'll show you in a second. It takes about 7 touches in order to close a deal. That means you're doing 1 touch per day, or even more than 1 touch per day in order to get them interested and moving them along the path. On average, most people aren't touching on an opp everyday, because it just happens, and again you may not be appropriate to contact someone every single day. On average, you need to be doing it at least every 3 days. If you'd have a conversation, you're going to schedule the next task, the next task might be a follow up email. That email's got to happen within 3 days of when that first touch was done, because it's going to take you approximately 7 touches; so, if you're doing 7 times 3, it's almost 21 business days to get that done. That's going to cross over that 30 day time frame.

Key things from qualifying leads. It really goes back, do they fit your niche. Does it fit your target market that your going after? Do the systems that they use, systems that you prefer and can use. If you're using 5 different general ledger apps, that's really, really problematic on your infrastructure. You should have standardized processes; you should have standardized systems. You want to make sure that they're going to be amendable to how you operate, because if not, it's going to take you a lot more time and there's not as much value in the equation.

The last one that I'm going to point out is, do they have the budget. We talked to really, really good organizations, and they all say we will ask the client what their budget, or what they expect to pay for the services that they need. The reason for that, is they need to be able to understand, are we talking apples to apples, or are we talking apples to oranges; because, if y-, they don't have the budget, doesn't matter where the conversations going to go, it shouldn't be a client to take on. It's very foreign for people to ask this, but it's the right thing to do, because if they're not a fit, direct them to somebody that might be. There might be somebody who's a low cost leader and that you get what you pay for. But, again you can direct them to them, and a lot of times you'll be able to say, "Look, I'm not the right guy for you, or the right firm for you, because you want ... We just don't operate at that level. But, you know go and find someone that's going to fit there and if you find that it doesn't fit your needs and you want to get more of the best-in-class or someone that's going to know how your business runs and get you to the goals that you have, come back and let's talk in 3 months."

Tips and tricks, referrals. Let's talk about referrals. Best sales people in the accounting industry that do this, will have a meeting with their client; usually it's a moment of delight. Again, we've talked about how to do referral marketing. They will specifically ask for a referral. When someone says, "Oh, I'm not so sure." They'll say, "Well just give me a name. Give me one name of somebody." And they will press that particular small business client, until they get an actual name. Then once they get a name they immediately follow up with that particular name. If they don't have the contact details, they follow up with the person who's giving the referral and ask fro the additional information, immediately upon the close of that meeting. Yes, does it feel forced, but this is how sales people operate. And, this is again, it's not if you're doing great work and they're a promoter of what you do, it's not problematic; because you're going to be helping another one of their friends, or family, or peers, to be successful just like you've made them successful. So, you've got to be aggressive.

Second one is, you've got to push those opportunities as fast as possible through the sales funnel. We've talked about that before. Your emails, again, you are going to be doing email conversations, but those emails need to drive to a call, or to an in person meeting, or to a virtual meeting. Use calendaring apps for instance, to get them to pick a time on your calendar and then plug in an automatic virtual meeting. Maybe it's Zoom, there's other products out there as well. But, drive it to a face to face, because sales works in face to face in more relationship driven environments. Persistence pays, it'll take you about 7 touches to close a deal.

The really important one here, is sales people do this, no matter what's happening, when you finish one task you spawn the next. Let's just take the example of a once a year tax client, which generally you get done with them, let's say it's in March, and you're not going to see them again until ... Hopefully, you're going to see them again, but maybe it's in December. But, you're next task needs to be scheduled immediately. So, use your proper task management system. But, at the close of the meeting schedule maybe, your next task might be the thank you card that you're going to send weeks later, it  might be the follow up email in September on learning them of tax changes to understand, or it might be the client event that you're going to hold in October to prep for the next tax season. But, by scheduling the next task you don't loose any of the existing clients that you have or momentum with whatever sales opportunities exist.

Documented processes. If you're going to bring a sales person in, you got to be able to describe to them what they're doing, and how they do it. Just like everything else in the business, you want to have a properly and well document sales process.

Your visibility is crucial and critical, because it helps you understand whether or not your resources, your sales resources, are delivering what they said they delivered. And that you can service the stuff that comes through the pipeline if it comes through as expected.

You need to have a proper niche. We talked about this. Which as the right message, which then has your websites reflected websites reflected of that.

You need to track everything. Again, sales is all about tracking visibility, and relentlessness to minimize the lead times going through. So, you need to properly track these things. Which again I'll go through technologies here in a second. And technologies are going to help eliminate that friction with the client; e-signature is a good example about how to make it really easy for them to be able to take that next step, to go into doing work with you.

The system side of the equation overall. A lot of people say, "Well I need a CRM solution." Which stands for Customer Relationship Management. I'm here to tell you, you don't. If you are a tech company, that's trying to drive a billion dollar business, yeah go get sales floors. But, CRM solutions are expensive, they're cumbersome, and frankly they're only as good as the sales tools that are propped on top of it. And, unfortunately, I just have the resources for it, both to prop them up, to maintain them, and the money it's going to cost in order to have them in place. But, what you really need is a contact management system, because you need to understand, on your contacts, which ones are prospects, which ones are clients, and you need to be able to track the notes and the details about who they are. And that really is facilitated by a contact management system.

And the systems are always as good as the information you put in them. So, again, if you're going to be tasking your sales for folks to track everything, you need to be able to track what's happened after a client meeting, phone call, an email. Again, you want to be able to have it, such that when a phone call is made either inbound or outbound, that you know exactly where the prospect or the client was left at, and how to continue the conversation where it left off. Nothing is more off-putting than having another conversation with someone in sales, and them not remembering where we had left the last conversation.

Track as you go. Again, you got to be diligent across everything. And sales people especially have to be diligent. Every activity, call, meeting, needs to be tracked and you need to be monitoring the progress of those opportunities. And continually making sure there being ... Those opportunities are being addressed and being touched.

Don't worry about the concept of leads and opportunities. Again, just really care about those customers, those contacts, and the notes, as applied to contact management. It's real simple, if it's someone you're trying to pursue, it's really a lead or an opportunity, it just depends on whether or not it's been qualified or not. But, don't worry about getting systems that are able to track them independently. For all intensive purposes, if they're somewhat of interest, it's an opportunity, it's just a matter of whether or not you should be focusing your time on it.

You want to capture the details of people, so you can proactively reach out. You want to be able ... If you've been able to capture a bunch of contact information, you were at a networking event, or what not. You want to be able to know things about them in terms of their relationship. You want to be able to send them a thank you card, a birthday note. You may know something about their business; so, maybe when something else comes up you can give them some advice, because that's going to lead them from a marketing funnel into a sales funnel and you can nurture them over time.

A lot of situations and a lot of contact and CRM products out there, can't handle the accounting industry. Again, you may have a client or contact that might be a tax client, they might be a small business owner, they might be apart of a non-profit, they might have 17 entities underneath them. And again most systems fail on that, because the 1 email address is related to 1 project or 1 client. So, make sure that when you're looking up products or technologies, they can support that.

There's a bunch of different sales products out there. I've listed out, what I call horizontal ones. These ones work for any industry. Whether or not you're in the accounting industry, or other ones out there. But, Hubspot, Insightly, Pipedrive, again there's a whole host of them out there, that people use for sales. Other ones out there, again, that people use in terms of helping nurture through the pipeline, are Calendly, so you move someone from an email to an actual appointment, Zoom, to do teleconferencing, and Gorgias is just an example of how to do tasks and ultimately some lighter weight sales, sort of follow up from doing email campaigns and so forth through Chrome and Gmail. If you want some of these more industry specific, you can check out Karbon, we do bits of it as well, and hoping that if you're interested in something that's more focused on the accounting industry.

So, now we've talked about ultimately the technology, ultimately the process overall; let's just go down into the marketing funnel, that's actually going to lead to your sales funnel overall. So, the first one again, is just you're inbound. Inbound and outbound are like a see-saw. When you first start out, you're going to be focusing your efforts on inbound, because you need to be to prop up your website, you need to be able to sell the story. And then as you remove focus from that you, you then want to T up your outbound. So, you're going out and finding people, because it's not always ... You're not always to have people find you at the rate that you want.

And you have all the slides and everything, provided to you. Again, I've given a marketing one-on-one discussion, that's also on firmofthefuture.com. But, these are all the different things you can look at that's in the marketing mix. There's a lot to it. And so, let's just ... I'm just going to focus on the main things, for inbound overall, for you to really know. But, that's a collective set right there.

One is your message. If you want to be able to attract people and close deals, you got to be able to speak with the message where it's going to resonate with your audience. And that's why target an audience, that makes market focuses really important. Because when you ... The words that you choose, the slogans that you use, the arguments that you're going to put forward, they got to resonate. Again, narrowing it down is going to be very helpful.

Second one, is once you understand that message, you're going to re-tweak your website. You need to make sure that the incoming people know what you do, how you do it, learn about you, and they're validated so they can pick up the phone and reach out to you to learn more. Your referral marketing is your number 1 place to go. So, again, with the prior 2 pieces then you can go do a real push on the referral side. And referrals might also lead to ratings and reviews, which provide you social validation online for again people to take the next step forward. And so you want to maximize the benefits that you have in your existing customer, because again it is a referral based business.

Then again, if you want to take the inbound to the next level from that, then we're really talking about content marketing. And this is where you need to tune your website to be search engine optimized. And possibly being doing some social activities in the like. So, this is a collective set of things to do on an inbound marketing side. It's all about being relevant, it's about having fresh content, and it's all super targeted. The reason why it's the first place to focus is, it's super, super inexpensive as compared to outbound. Typically, most firms under invest in it, and the examples of things people would do is on the right there. Again, website, SEO, social proof with Google My Business, or find a pro-advisor directory, and again, there's other things on there around the content side.

Now, step 6 is, as you've done the inbound bit, you then want to move towards the outbound. You need to be super smart about how you do your outbound activities. Because if you're not, it's essentially ken to doing this. Taking money lighting it on fire, and throwing it out the window. Because advertising can be very expensive. Again, it's not necessarily the right thing to be doing. And if it's untargeted, unfocused, you are going to get a super poor [inaudible 00:49:44]. And again, it's literally like throwing money out of a bucket at the window. So, the things you need to consider in the outbound is, it's the highest cost vehicle, it really has a low probability for success, and again this is where your talent on sales and marketing gets you a step forward; but, also how narrowly you focus is important to improve that probability.

And how do you get there? Well, you need to talk to your existing clients. Find out what they do, how they do it. What is their journey? Where do they consider services, like what you offer? Where do they shop? Where do they buy? Again, get into the head of your particular target audience, and figure out where you're able to intercept them in key moment of their journey. You got to speak their language. And then you got to figure out how to peak their interest, and give them 1 call to action. So, every email should have 1 button, every conversation should have 1 hook. What is the thing you want them to do next? And then drive them to that. Examples of outbound, e-newsletters, email marketing, some of you may do direct mail, again it doesn't have to be to peer prospects, these might even be to existing clients that your trying to nurture into becoming monthly subscription clients, versus once a year clients. Local events, we've had people partner with folks in Apple store, to do training on small business. And then you start to get some more of the expensive stuff, like Ads, trade shows, cold callings telemarketing. The things at the top are relatively easier; the things at the bottom become much more complicated, time consuming, and expensive. You need to figure out what's right for you, what's right for your audience that you're trying to attract.

And then, last step of this all comes down to scale. Now, you want to scale up on your sales function as it becomes accretive. What I mean by that is, my definition of that is, when the revenue is going to equal the cost plus the margins you want to assume. If you have good visibility across your sales pipeline, you understand how you know it is how ... You're ability to close and what time frames. You can start to see where the amount of opportunities that sit in the pipeline are passing the capabilities of the sales person. And that you're losing on opportunities, because you're not able to address it, with enough resources to close them in a proper time.

Now, some people decide to wait until when the person comes on there's enough in the pipeline. for them to be able to instantly be able to substantiate the cost of that additional resource being added. Others will do a 3-6 month sort of ... Doing it 3 months beforehand, because they know that there's training involved and they want to time the point where the person is going to be the highest level of productivity, to the moment where the sales pipeline is rich enough to substantiate that extra body. So, again, you have a full queue to work with. So, that's essentially how you're going to scale, and that's how you scale from having 1 person, to 2 people, up to maybe that one firm I mentioned that had 16 people overall.

So, I know that was a lot of content today. The point was to give you a full holistic view of how sales should function in an accounting firm, and who ... What the best of the best are doing out there overall. So, I just want to give you a quick recap. Again, we're going to get to that polling question here in a second.

So, the one is again, how to have that simple and effective sales process. It first comes down to your target market. Be as narrow and as focused as you can. Number 2, you've got to be able to measure this. And I gave you some high level, ones that you already know. But, then what I call accounting as a service metrics, and those particular sales measures that you want to look at, which is from opps to close, the cycle time. And the quality metrics and things of that nature. Next, comes down to structure. Think of your business as a small business, it is. Again, you need to have the proper functions to support marketing and sales. It's not just a side job for somebody else. If you really want to do this you need to have the right people doing the right jobs.

And then you have to have that infrastructure in place. You got to ... You have to have the right people, with the right incentives, ultimately being able to leverage the right processes and the right tools to be as effective and efficient as possible. Then you're going to focus on working on your marketing funnel to lead you to the best amount of leads into your sales funnels, and you're going to start with the inbound side of the equation, and then you're work to outbound. And it's going to see-saw your efforts over time, as you're able to tweak each one of those in and out. And then you're going to scale it up further, as it becomes accretive overall.

So, again, if you want to have more education tips and tricks; I referenced a lot of things in terms of target market. In terms of marketing 101, organizational design, they're all up there on firmofthefuture.com. So, you can go ahead and check them up there.

With that being said, before I go through the rest of the slides, do you want to get the polling question up there for everybody? So, I'm going to go ahead and put this up. the poll. I'd given a CPE challenge question today. And you're answers are Robin, Chickadee, Woodpecker, Cardinal, or Quail. So, for those of you, please respond with your quick answer. Give you a couple more seconds; 3, 2, 1. Get your votes in there. And I'm going to close the poll.

So, firmofthefuture.com if you want to learn more background, in terms of what I talked about today. For those of you who actually want to do more education, a bit broader, you can come to Firm of the Future. We talk about subjects like this, we talk about referral marketing, we talk about practice growth, practice efficiency, value pricing, all of that. Go to Firm of the Future. Again, you go to firmofthefuture[inaudible 00:55:20].com, or go to qbtrainingevents.com, to see what's locally and in your area, or online. You can also do fundamentals training for Quickbooks online. If you want to get certified, again that's the next step of the journey, and then lastly the advanced certified.

Then if you're interested in a lot of the content that I'm talking about and so forth, you can also go to Karbon. If you want to learn about upcoming webinars and our additions overall, you can go to karbonhq.com/additions. If you want to demo in Kabron overall, go to events.karbonhq.com.

Overall, I just want to give a big thank you. If you have any questions, comments, and so forth, feel free to email me at ian@karbonhq.com. I'm not shy, I'll answer them. Today, the webinar was brought to you by Karbon and Intuit overall. Appreciate Intuit for that overall, and again appreciate you spending the time and learning about how to do a simple and effective sales process.