Breaking the Seasonality of Your Practice
Focused primarily on tax services? Learn how to expand your business and tax client relationships into ongoing services like bookkeeping, accounting and advisory services.
Hello everybody. Welcome today's webinar. We're covering this month, post-service sales and marketing. Today's conversation's really breaking the cycle of seasonal clients. This is all in terms of content that we're working through for the month of April.
What you'll find here going forward for the month and you'll see on firmofthefuture.com , we've go today's webinar, break the cycle of seasonal clients. You'll see two articles being posted up pretty soon, one on the three R's, ratings, reviews, and referrals. We'll touch on it just slightly here a bit. Also, on measuring, capturing and capitalizing on customer satisfaction, you'll see that article as well and we'll touch on it a little bit in this as well and then we've also got a panel discussion coming soon as well. That'll be recorded on the art of the up-sell and the cross-sell.
Again, all of that is going to be covered in a light weight fashion here today. Let's go through some of the logistics for today. Before we get started, just a few things. First, if you're new to go to webinar, you'll see that big arrow there on the top, you can collapse and open it up. If you need too, close any apps that might slow your connections, like Skype and other things, and then we're going to discuss questions at the end of the webinar. I've got a panelist with me today, Guy Pearson, I'll introduce him in a second. I've also got Andy, who's going to be answering questions as we go. I'm not able to multitask so my apologize but we'll flag questions if we can so just flow them in to that questions panel.
Today's conversation or today's webinar is a CPE. CPE credit is available. There will be a CPE keyword somewhere throughout the next hour with a question ahe end for you to answer so be on the lookout for that CPE keyword that will pop up somewhere in the presentation.
Want to introduce who's here on the line here talking to everybody. My name is Ian Vacin. I'm a Co-Founder and the VP of Product Marketing at Carbon. If you want to learn about us go to karbonhq.com. I've been in the industry for well over fifteen years. I worked at Intuit for almost ten of those. I'm usually [inaudible 00:02:16] advisor program, and I've worked at other companies in this space. Hopefully Guy can get off mute, but I want to introduce Guy Pearson, he's the CEO of Practice Ignition he's also the chairmen of Interactive Accounting. You can tell by his accent that he's an Aussie, at least hopefully you can tell.
Good day mate.
Hey, sorry there Guy, but he's fantasist. I haven't brought on a co-host on one of these webinars yet and I'm thrilled to have Guy. He has an amazing amount of insight, especially on this topic. His company is also geared around doing a ton of things around this as well so welcome Guy. Give a little detail on yourself too.
Thanks Ian. I'm Guy Pearson. I tried to emphasize the Aussie accent on the way in there, sorry about that. As Ian said I'm chairmen of accounting which is Australian CPA. My background, I started and ran a Cloud accounting firm called Interactive Accounting, which is now at the grand old age of six, has two offices in Australia, looks after companies in about eight different countries. It's help raise an exit for some of our software clientele.
I left that company on the day to day to start and run Practice Ignition, which you'll learn a little bit more about in a second. We're basically both trying to help all our Cloud Accounting firms move to the new business model that's required for the Cloud and break that seasonality, which is why we're here today.
Again, I'm thrilled to have Guy. You're going to see as we go through today's discussion, he's got a lot of really good lessons learned stories and really, really, really good insights about how to move your business from being more periodic in nature to really smoothing that out. Having those consistent clients that have higher profit and ultimately, are more of a joy to work with.
Just to give you guys a quick little primer. This is not a demo. This is not an intro. Karbon is task management for accountants. If you want to learn more about us, go to karbonhq.com. Nice little screen shot for you. Ultimately, Karbon allows you to bring all of your email, your communications together in one place. It's a triage that to create work. Ultimately, allow you to use checklists and to-dos to get the work done. It brings it all in together into projects. It allows you then to be able to know what to do. Not only for yourself, but across your team and across your practice. Again, learn more at karbonhq.com.
Guy, a little bit about Practice Ignition. Give it a little bit of color.
Yeah. Sure. We are a contract engine at heart. I built a contract engine for you to build and deliver your engagement letters to your clients along line and build that engagement electronically. You could track everything that was in it. Our acceptance would then connect through to the web flow engines. Then provide billing over into ledger systems. We collect and distribute payments from your client to your firm. We actually reconcile your ledger for you. It really gives you that scalability of an e-commerce style company. It allows you to move through it's monthly billing cycle as people do move to the Cloud and the Cloud software.
Hitting on it a little bit deeper, some more of the engagement and onboarding process. We do deploy that back office system. We help you deal with your renewals and scope creep. Like I said, we do collection, distribution and reconciliation to payments. It's all circled around your clients.
We've just recently launched some new visibility analytics and dashboard over the top of this, which actually allows you to see which clients take up what services for what dollar value. It really gives you an insight to where you're heading. Because we deal in contracts, we're not looking at time and costs, which is backwards facing. We're looking at where you're heading from here, and what your recurring revenue run rates are, projected revenue for the future, projected cash flow, and all that sorts of things. It's really a tool to help you run and plan your practice as you move forward.
If you guys want to learn more, the website is down there below, practiceingnition.com. We'll give you our contact information at the end.
Let's get in. How about we get into the content and talk a little bit about this in detail? Sound good?
Sounds good to me. Yeah. It sounds great.
You've guys have seen the title we've talked about several times. Let's get into the thick of it. Today, what are we going to talk about? We've broken it down into really five parts.
Part number 1, I'm sure everyone is very much aware of, which the yearly problem. We're going to go in from there. We'll have a little bit of context of what the problem is. Most of you already know that well. We're going to focus on who to engage in that process, so what are the right clients to pursue? What do you actually need to offer them, or what is the right things to offer looking at the full set? We're going to talk about the conversation, which is probably one of the most critical components of all this. In order to bridge between what they're doing today and ultimately the close to get them to be an ongoing and happy, and obviously, paying client for you year round.
We're not going into a lot of detail here. Again, it's very timely. Tax deadline was on the 18th for us in the US, and in Canada again it's on the 30th of this month. It really comes down to it's one of the great opportunities where, depending on if you're an enrolled agent, whether or not you're a CPA or you're actually trying to enable to assist one of those two in order to do the tax filing work.
With no doubt there's definitely a spike in the amount of work that we're all getting between December and April. How do we then leverage that work and leverage those opportunities to be able to add to the small business clients that we're currently servicing on a daily, weekly, monthly basis? We're going to go through a little bit later the who, the what and the how.
Guy, give me a little bit of context just so people know from your background. When you started with interactive accounting, I feel like you're representative in terms of what a lot of folks have here. In terms of, you have this huge spike in your business. You had to learn how to move that and flatten that in order to have a sustainable and consistent business to operate from.
Yeah. That's exactly the right Ian, so not so dissimilar to the US, the Australian CPA firms or CA firms had effectively an annual peak. We have a little bit longer to ledger our tax returns, so it's slightly different. Everything is compliant centric. As as soon as it hit down time, you're revenue would just plummet. You'd have to figure out things you could do with your staff in that time to make sure that you weren't losing money hand over foot.
One of the things that we looked at was that our customers, the biggest piece of value they got wasn't necessarily the filing of the tax return. Obviously, that's what forced them to come and see us. The biggest piece of value they got from us was talking about what the numbers actually meant. We even did things like a SWOT analysis. That's the strengths, weaknesses, opportunities and threats to their current scenario. Whether that was one business, or whether it was a group of companies, or just an individual, so that you're ahead. Even doing a bit of facts finding with them, talking about what their plans were for the year ahead. We found out that the real opportunity was identified to increase the regular touch points with that client, because it's all very well and good.
We, as accountants, we go to these conferences. Just like your clients come to you once a year. We get all pumped up. Then because no one holds us accountable, we talk about exactly the same thing next year. We have the intention to change. It seems to become an ever revolving cycle. One of the things we tried to do was move everything back to well let's get more involved in what happens on a monthly basis. Let's try to hold you accountable to your goals, and let's move towards that monthly cycle. Ironically, the clients because you're seeing them more, the pile of work at the end of the year isn't as high on your desk.
The second thing that happened is that well, it actually doesn't cost you that much more to move to the monthly cycle. You're dealing with things more regularly. You don't have hours and hours of Q & A at the end of the year. You have 10 minutes a month. It really changed the way we looked at doing business. The clients became happier. This is 6 years ago, so we had a big problem trying to explain why we were doing this with clients. Also, it did break that back. It really put us in to advisor standpoint, rather than just being a tax clients person.
A couple of things right on that. Guy, was one is when you get into the yearly model here, or the scenario that most folks are in. You get massive employee fatigue. A lot of you guys are taking vacation last week, might still be on vacation this week.
You have this ability, because you're interacting so closely. You're so involved during that time period. You have this enormous opportunity for up-sell and cross-sell. Like you said, there's a lot of things you can give like planning and business development, insights, looking at the numbers, not necessarily processing number.
If you stay in this cycle, it's just a self-fulfilling cycle. Like you said, you're getting out of one period. Then you're basically collapsing in exhaustion and then get back into it again. You've got to break that cycle. Again, there's so much lost opportunity. One of the things that you and I talked about offline going into this was, one of the ways you handled this for your tax clients was ... Again, this was back years ago when it was still in its infancy. You pushed them onto Cloud accounting, because that ultimately allowed you on the back end of that to be able to understand things as they kept moving forward, regardless of whether or not they were continuing to work with you. It ultimately lessened the amount of work you had to do.
What was some of the watch-outs or benefits by doing that ultimately to ease this particular time period, but open up the doors on the rest of the months?
That's a good point Ian. We made it mandatory to have a Cloud accounting system. We made a conscious decision to move entrepreneurs particularly at my firm. People who ran their own business, they weren't really interested about what happened 9 months ago, when their tax return was being filed or 6 months ago. They wanted to talk about now and where they were going. By forcing the implementation of systems like that, like QDO wanted us to do with the way we did things. We were able to build standard packages up off the back of that. We knew on average how long it would take for us to, A, process a transaction if we were doing a book keeping.
Alternatively, systems and training became normalized across the whole group of our clients. Once they were started on the Cloud system, we knew we could do a training and set up relatively easily. What it ideally pushed us towards was this constant visibility with our clients. Anyone who's ever spoken with an entrepreneur, they don't like waiting for anything. For them to have to wait 2 weeks to get their monthly pay annuals or anytime to get any sort of value advice, they're not very patient with that. I would dare say that a group of 75%, if not all of your customers, have smart phones where they access their bank data, what's going on in their business from an email standpoint or workflow standpoint. There's all these things that they do from their phone. I don't understand why the accounting has to be any different, and I don't think it should be. This really puts you in a position of power. You can enable that business visibility for that business or that person, to come directly from that smart phone or from their computer login when they're on holidays in Hawaii.
A lot of our early customers, they're goal alone, most people would say they saw Cloud as valuable. They didn't actually have to be in the office. That could either A, mean that they're out generating more revenue, or B, spending more time with their family, or C, in different country doing whatever they wanted to do.
I remember one of the funniest ones was a guy who started a travel business, who basically told me that within 18 months he wanted to run the business from the Bahamas. This is Sydney to the Bahamas. He had companies all around the world, little offices. He just wanted a centralized 1 dashboard, with a 1 workflow system for the 10 ones. It's a collaboration. Basically, to be able to look at that everyday and then go back to drinking a mojito.
You can actually help your clients solve that problem, but you can also help yourselves break that seasonality. That year end tax glut, by encouraging them to take more interest in the business they're reporting. Give them more invisibility data. Ultimately, the other thing that tends to happen is your margins go up. You can actually offer in some places to do it for cheaper.
Now, I know no one really likes charging clients less. If your profits do go up scalable, you can continue to drive efficiency, which Ian has talked about. It means that you're more scalable. It means that you can have more clients. It means that you can grow that business on that monthly recurring model. Rahter than having that on completion, in arrears problem and your cash flow will improve.
We're going to cover a little bit here in a second, which is how to understand from a business owner what is driving them? You guys answer it. We call it the big why? What is the goal that they want to achieve? If your able to center on that mutual goal, that's when you're able to open up new possibilities. That's when you're able to figure out what the willingness to pay, and being able to address and bridge the gap between what you can offer, what's going to benefit them? How mutually it will work together?
Let's go onto the next step, Guy, which is really ... We talked about a little bit of the problem. I think you've got a little bit of color about the benefits and how we can get there. Let's dig in down to the who. Obviously, identifying the right clients, it's pretty critical. There's a lot of folks that are going to come through that if you are servicing them on the tax side aren't going to necessarily lend themselves to be ongoing clients. You've got to figure out which ones are the best ones to approach. Why? Ultimately, how to approach them? We're just going to focus on the who right now.
I've put a few things up here. We're going to talk about the candidates. We're going to talk about some requirements we're going to have to see in customers. I'll bridge it here first with the slide-ware, and then we'll talk about it in general.
Really, one of the things, and again you brought this up before with the entrepreneurs specifically, is the frustration of not necessarily knowing where things are at and where things are headed. Having a person who is helping them, sitting there by their side and helping them recommend what choices the can make, so they can make better business decisions. When you can sense and see the frustration of what they're currently doing. Whether it be by themselves in a do it yourself scenario or possibly, whoever is advising them currently isn't up to snuff in terms of giving them that visibility, that comfort, the ability to make those decisions that are able to drive the better outcomes for the business. It's a good candidate for you to pursue.
Obviously, in number 2, books are a mess. You're going to see this again. Some of you focus on cleanup work, which is great. Again, you can sense from that, most likely they're doing it themselves. They don't have an accounting professional in their corner assisting them. Again, in other cases they may. Again, you can dig into that and see well, this is why you're not able to. You might frustrated with the businesses, because we're just here cleaning up this mess. Here's how we can go to keep this mess from not occurring again. Obviously, there's a huge cost associated to having to do that at the year end. They don't wan to go through that another time.
No Cloud accounting in place. Again, we talked about that briefly Guy, beforehand, which was using that as a tool. Ultimately, helping you to understand the ongoing situation of the business and how it's moving forward. Again, using that as your own tool, but that could be a tool for them to be able to move forward in time. Be able to have that visibility, that tracking of what's going on in their business day in and day out. They're going to need somebody to help them service that and understand that going forward.
Again, another one. It's interesting here, is when you look at the numbers again, the whole point is putting the numbers together. You now have all the numbers at your fingertips to be able to quickly look and process and understand where opportunities lie. We're going to go through a concept later about to give to get. Again, don't sell yourself short. When entrepreneurs are working on their business, they're trying to provide the best service that they sell. Whether it be services, whether it be some widgets that they're making, they know that inside and out. They don't know the finances inside and out. That's what everybody here on the call knows. That's where they need help. When you can help point that out and show opportunities that they're missing out on, it really opens the door.
Again the last one is obviously, if there's no accounting professional in the mix and many of the things we've seen above this in the bulletted list are indicators of that. It's definitely an opportunity for you to speak up and ultimately to show the value. Then deliver the value that they want. That's a bit of the top candidates. Anything I missed there Guy? Any clarifications on that list from your past?
No. The only thing and I think we talked about this last time was this surprise winner as a top candidate, which doesn't fit in in your normal thinking. It's actually the elderly. I know that sounds strange. Some of our best early adopters of technology was actually people in their 70s and 80s, who had investment portfolios or rental properties or things like that. The reason being that when people get a little bit older, they're really concerned about the mess and adverted commerce that may be left on their departure from this earth.
We had initially half a dozen clients who were really worried about leaving their grand children and children without an understanding or access to information. The mess of what they had done throughout their lives and the cost bases of shares and all of those sorts of things.
Actually, we put in place Cloud technology, so Cloud accounting, Shares, a company Shares Site, we put it in their platform for these entities. It gave them complete, if you like, release of the stress that they had.
I don't think it should be overlooked. The other thing that it enables is people get used to working with you on the Cloud. They're no longer trapped in that coming into see you to do their taxes mindset. That was the other big thing. We had a lot of our elderly clients actually move into the stage [inaudible 00:21:18] and stay with our firm. Those things are things that can be overlooked in terms of that. Just a feeling I have in the data, the clarity, the ease of passing on. All they have to do was leave inside their will that the logins would be passed over to the next of kin and to the executor. It's not a huge thing to change for that visibility to be easily passed on. I think that's one that people often forget about. It was an amazing case study for us.
I think what's interesting on that is it's not necessarily about giving them access to the Cloud accounting. A lot of times in that case, it's actually the ability for them to click a button on their phone to see where everything stands. They don't necessarily have to have the understanding of all the underpinnings of all that, but they have to have to have the visibility where things are at. They're comforted day in and day out where things are trending for their business, whether it be rental properties or the like. I think it goes into what is the right way to deliver what people are wanting to see or have knowledge about or comfort and then providing that. These technologies are just facilitators and enablers of ultimately getting that goal. Ultimately, you, the accounting professional are being able to provide that and then serve it up and then give the insight around it. Is that accurate to say Guy?
Yeah, that's fair enough. Indeed.
What are some of the requirements of this? We talked about candidates here. What are the requirements that you need to understand when you're doing the seasonal work? What are you trying to look for?
Again, I put up 5 here. Guy, I know you're going to throw in a couple extra ones in here, but I'm go off of what I wrote up here. The first thing is, again and you should be doing this. This should be without question already in place. Again, you're doing the work. You need to establish your rapport. You'll get a sense of whether or not that's actually indeed happened based upon the body language, the email tone. Again, you're providing the best client service that you should. That's what we all strive to do and how we deliver it. That should be a given.
Again, if you don't have that, it is not advisable to go ahead and try to pursue a deeper relationship. You just haven't done a good job on the initial one.
The next one is we're going to look at Net Promoter. You should be gauging what your customer's satisfaction is. One of those gauges is really what is called Net Promoter Score. I'll talk about it in a second. You can classify folks as promoters, passes or detractors.
If somebody comes back and is registered as a promoter, this is a person that you want to engage with further. They really love your services. They're vocal about it. Again, they're going to be already pre-wired to ultimately want to do more with you.
The next one is really when you look at ... Again, we talked about the top candidates here on the left. Can you establish some clear value about how your interaction with that client going forward is going to provide you a win and them a win. You need to be able to understand and articulate what the win is going to be for that small business client. When you talk about pricing, profit and so forth, that's where you've got to create a win-win scenario, so that they're willing to pay. Your going to be willing to service. Everyone can be happy at the end of the day.
This just goes into some of the, you've already done a lot of the pre-work in understanding the numbers. Then you need to be able to go and translate and communicate that back. We're going to talk about that step 4 in a bit.
The next one is willingness to pay. You all know this. You can understand this even from the first email or the phone conversation or just the method by which they interact with you. If there's not a willingness to pay, you're rolling a boulder up a hill that's ultimately going to come back and crush you. You need to identify that. That goes back to, can you discern the value? Can you communicate the value? Are they willing to appreciate the value that you're going to bring and what you can deliver?
The last one is, really the existing trusted advisor conflict. If they've got an accounting professional in the mix that happens to be a CPA that you work with across multiple clients, you might not want to tread on other people's territory. Unless, they are doing a really poor job. It is a small industry. It is a referral industry. You want to be careful about how you pursue some of the clients if a case does overlap with others that you have. Those were my top 5 that I put up there. The bullet is not supposed to be more than the top 5, but Guy some insight? Any of those that registered high for Interactive Accounting, or things that you would advise?
The clear case of value, I think this comes back to a discussion. Like I said, we've had this before, the biggest thing that we learn, probably the hard way, was the R & D that you have to spend to demonstrate before we show the clients that we spend the time and money on R & D on a client. It might even be just half an hour of being able to put together a presentation or show them the value that we can present to them on a different cycle.
I think the first way that I learned this was, I actually hijacked a client some let's call it a QBD file. In Australia we didn't have QBD, but I'll try and normalize it. Then I converted them over the weekend to a QBO file. This is before any of the conversion, so once again going back 6 years. They came in Monday morning. I actually shared. I entered my first task in their office. Their CEO came in. I booked half an hours. I said, "Justin, now I want to show you what I've done over the week." I pretty much had moved all their business online over the weekend. I did it for free, because I wanted to learn how to do it. I wanted to learn how to sell it. I wanted to figure out what the value part was and show Justin how he would now do his things like Banker. How he would get his data in. How he could generate reports. The real fortunate thing for me is that Justin used to be a financial controller. He was just blown away.
I think the biggest thing that people don't talk about is you want to spend some time schooling yourself and even just trying this for your own business. Imagine you're pitching it to your business partner or to your husband or to your wife. You need to be able to sell it with some authority. You need to be able to explain clearly the value.
If you can match that up, you then pick your lowest hanging fruits. You start with that as your client base. Even better is if you can have an industry bend anyway in your practice. What it allows you to do is do that R & D on that. You might spend a couple hours, but you know that you can pretty much present very similar things to ten clients. I think if you start with those, the rest will just fall in line behind them.
You just really need to be pitching. Pitching maybe the wrong word, but showing the value of the work to your clients. What that business needs to achieve to your clients.
I think, Ian's got a great list here. I think when it comes to me and my money, someone has to be interested in the future and where they're heading. Have goals. Have desires. Dreams, whether it's owning a 66 Stingray Mustang as their end goal. I don't know what it is, but they need to have something in mind they want to achieve. You need to align what you can help with in terms of converting them to the Cloud, giving some visibility, talking to them each month, breaking down the barriers to their business, so they can achieve their goal. If you do that, you will A, break that cycle, B, move everyone onto the systems you want to do, and C, probably earn if not more money, greater profits in the process. You will become that trusted advisor. That client will become a promoter.
I can't tell you how, and Ian is going to talk about NPS in a second, which is a measure of whether or not someone is a promoter. When you get someone who is a promoter for your business, your marketing spend, your referrals, all those things start to just ... The marketing spend just dwindles away. Your referrals will pick up. That took a good 3 years for Interactive Accounting, because we were a brand new firm. I was pouring beers at night to keep the lights on for us to generate that sort of rapport.
By year 3, we'd been growing off cold clients who'd never been in before. Decent marketing leading then up to that and then the referrals. I don't think we were ready for that. We had to hire pretty quickly. It's an amazing power when that starts to kick in. I think if you can find the right people, if you can present the right value, which aligns both their goals and your goals together. Present a really good scenario to your clients. Make sure they understand that it helped them. Then you without a doubt will generate promoters that will then build your business.
I'm going through it really [crosstalk 00:30:28]
An existing advisor can help, I'm not sure. Reality, unless it is someone like an insider you do all the business with. If it is you should be jumping on the phone straight on to that advisor, and going what the hell are you doing? We need to get in sync and change all of this for our co-clients, because this is where I'm going. If not, they don't necessarily have your client's best interests at heart. That's a hard thing to stomach, but it might be a frank conversation you need to have.
Yeah. On that particular point, it might be that they're doing too much for the client. It's outside of what they're core competency is. Therefore, maybe it's advantageous for you to take over more of the relationship. Then they're doing what their focus is or their niche. Maybe it's just taxes. Yours is bookkeeping. Again, it really depends on how that scenario is playing out.
To your point, Guy, on the Net Promoter, I'm not going to go through this in really nauseating detail. There is going to be an article in a couple of weeks that you'll see on fromthefuture.com that talks through how to set this up. How to measure it. What are the next steps around implementation and leveraging it? I do want to give a quick little tidbit on this.
This is what Net Promoter looks like at a high level. It's based on one question. How likely it is that you would recommend our company, our firm to a friend or a colleague. It's measured on a 0 to 10 scale, so an 11 point scale. If someone answers with a 9 or a 10, they sit in the promoter bucket. 8 or 7, they're in the passes. Then 0 to 6 in the detractors. Then you're just taking the percentage of promoters and subtracting the detractors. That gives you a score between a 100 and a negative 100. Best in class in industry is pretty much a score of 40 and above. 0 to 40 is middle of the road. If you're in the negative, you've got some serious problems.
Why this is important is when you measure Net Promoter, again a promoter is going to give you 3 referrals or more for your business. While a detractor is going to give you 10 or more negative referrals for your business. It's the balance of where you put your focus. Again, the more you can drive up to that promoter, the more it's going to be beneficial for your business. It's going to lower the costs of marketing. It's going to increase lifetime value. All of that great stuff.
The reason why you're bucketing these things is so you can understand what are the root causes. Why are people sitting in the passes? Who are those people I can go talk to? Again, reach out to 3 or 5 of the clients, and see why am I not wowing you with what I do? Those that I am doing that, what is it about what we're doing in servicing you that's doing so well? Is it because we're focused on your particular industry? Is it because so and so in our business is focusing on you and your client needs and so forth?
It's very good way to start to decompose what's working and what's not. You can double down on the stuff that is and quickly address the stuff that's not. Again, it can have massive impact on your business profitability and on your practice growth long term. That's a quick little bit of a primer. Most people will do this at the end of projects. Best in practice is doing it ongoing basis. Look for the article. It'll give you more detail.
Make sense? Ready to move on Guy?
All right. We're at the keyword. Surf Board. Those of you who are here for the CPE, I hope they're here to listen to you Guy. In honor of Guy and his Aussie roots. The recent Great White shark attack, I guess that's what the powers that be have determined the CPE keyword is here. I do not want to be in that surfboard. It does not look like a friendly place to be. I do like surfing, so it is a little bit scary for me. Today's keyword is surfboard. Just to repeat that one more time, today's keyword is surfboard.
You are going to have that challenge question at the end of the webinar. Don't think you're going to get off early here on the next one when we pop up that question. Sit tight. Hang with us.
Ian, just for clarification.
Is that one word or two words, because it is capitalized. It does look like-
I was given the slide. I think it's actually one word. We're going to go with two, maybe that's the curve ball. Maybe you have to chose it as two separate words at the end? Then one option is combined?
I don't think that's going to be the case. Everyone hang tight. We'll see. Maybe I'll steer. Maybe it's option C. Maybe option D. Hold tight, surfboard.
Let's go into, we've talked about who. We've covered the problem. Now, let's go into the what. What are you going to offer ultimately for clients? You've brought this up several times Guy. I'm going to bring it up several more times. It's really important in the value conversation in terms of decomposing what it is in terms of the end goal. How we're going to get there. What is it that we're going to offer in conjunction with that? We're going to talk about the what. We're going to come back to the conversation.
Just as a little bit of a primer. I'm sure everyone is aware of this, but just some background. If you ultimately wrap it up, what everyone is doing together, it really falls into 7 different service types. This is in regards to small business, for individual tax planning and wealth management. That's another category. It's not included here. We've been living and breathing the tax side over the last few months. That's some of the service types that we do there.
If you're curious in terms of all the different panacea of things that could be doing across all the different service types, here's a quick little road map of what you could be doing. This is to help you in terms of if you're talking about bundling. If you're talking about presenting packages to clients and then using categories to describe it, here's a quick little makeup. Took a screen shot. Again you can watch the recording too later to get a lot of the details.
Again, most of the stuff you're doing is probably going to fall into one of these buckets and be described some way, shape or fashion. Why is that important? It really goes into how you're going to communicate how you're going to work with them, and how you can move them up the value equation. It's really talking about how you up-sell. Again, you may be starting from a point of okay, we're just going to do the tax work. We'll get you past that hump. We got to do some cleanup. We're going to make that deadline. That way that compliance side of the equation is done.
Going back to what Guy was talking about, if you're initiating a policy of moving those books into an online accounting like QBO, then you're ultimately doing the bookkeeping regardless. There's teeing that up to be done on an ongoing fashion. That's really the first starting point that you could go down. Which is, okay, we can just keep this running for you, so that you don't hit this huge wall when we get to year end. Ultimately, proceeding compliance.
The next side of that is okay, well, we could do just the bookkeeping. We could step it up a notch and do a lot of the other things that you really hate that take up a lot of time, but that we can do really, really well and really fast. You're going to get back those various hours that you use to do this work, where we can do it at a fraction of the time, much more efficiently, with better outcomes.
That really centers around bill pay and the dreaded payroll in terms of what you got to do for filing, understanding compliance issues around it. Again, whether it be monthly or biweekly, whatever the scenario be. It's a bookkeeping plus realm that you could go down with the client.
Then you start to move up to fully outsourcing. Then ultimately getting to where Guy was talking about in terms of advisory planning, budgeting, forecasting, and so forth. Before that is really the accounting side. I've used these as examples I've seen across a bunch of different practices. The do the bundles. They do the articulation. The accounting really comes down to selling the reporting of that, so the understanding of the numbers and some of the ongoing tax components. This might be your yearly tax work comes in, but also the ongoing tax stuff with sales tax. That's the middle ground.
Then the last one is the full menu. This is the let us be, your outsourced CFO, your virtual CFO, whatever you want to call it. This really goes into the things that really move the business forward. This goes back to that conversation that you're going to have, which is what are you trying to attain? How are you trying to get there? Here's what we can do to get you down that path. Ultimately, be able to drive value for you and ultimately for us. In this case, put in some examples, forecasting, risk management, analysis, planning and so forth.
This is an example of how you can step somebody up through the services. You may start someplace by bookkeeping. By your rapport, your relationship, what you're able to do, what you're able to show how you can deliver on these other avenues opens up the door broader and broader to have a much more fulfilling relationship. Again, drive a lot better margins. Ultimately, have you be at the side of your clients to help move their business forward, which is rewarding for everybody. That was my preface to this. A little bit of an insight about where to go.
Guy, this goes back to your business and one of the reasons why I wanted you on the talk here was, I think you guys did this really, really well. You ultimately had to do this before it was really in play back 6, 7 years ago. How did you guys do this? How did you stage the particular up-sell scenario? How did you ultimately have these conversations?
Oh. Can I tell you it was all trial and error, which thankfully we were able to make it through and get the model right. The biggest thing for us was clients used to come to us, and I'm sure it's the same for all the listeners out there, that they would come to us with their existing scenarios. I have a quarterly sales tax return. I have an annual tax return. I get annual financials. I have a bi-annual review.
We built 3 plans if you will. That started off with the annual compliance, annual tax mating and we wrapped in that Cloud and accounting system into the package. We had a visibility all year round in case they needed help. We then had a colleague plan and then we had a monthly plan. The lessons that we learned over the years were that we could almost like a software system in pricing is that as you went up you would include a few extra things. Support groups, training for new staff, payroll included, all the little things that are easier for our client to identify more value in the plan higher.
The big thing is when you decide to settle on a package plan, don't be afraid of changing your prices. Make sure that your plan is typical a business signer. You know that you need to stay profitable in the same business. You have that business conversation with them as to why you're changing prices.
The funny thing that happened for us was we got these clients. They love this monthly reporting. They love the quality reporting. Particularly the reason why it would fall down is usually as a result of the client saying they would take on something like bookkeeping. The client would say they could do their own bookkeeping. We'd train them and set them up on the systems. They're more interested in running their business than making sure everything reconciles. Some of our earlier attempts really fell apart on those quality and monthly plans, because we were waiting on our clients. Thankfully, they didn't get angry at us, because they knew they were the cause. It really didn't help us achieve our goal of delivering any higher value to those clients either.
It first started out as a tax firm. We actually launched a bookkeeping and a management accounting firm within the same accounting firm. When people wanted to go onto the bigger plans, like quality and monthly it started becoming mandatory for them to have ... In Ian's example the advisory is the monthly one. They would actually jump. We'd say you need to do bookkeeping as well and charge a separate price. There was no negotiation. Explain to somebody why we'd do that. If we don't get the right data in the right time, you won't get your monthly mating. You won't get your monthly financials. We won't be able to talk about your monthly KPRs. We don't want to take that risk on your behalf. We'd talk about the marginal increase in phase and the difference it would make to their business in terms of what's the cost outlay? It's an extra point to the symmetry overall. Yeah. For us to give you accurate information faster so you can make good decisions. Do you think that's a fair spend? They'll come back and say yeah. That sounds great.
Once again, it became appealing to value before these meetings. We'd do the R & D on the client to understand where the business sat. What industry they were in. Understand how many people they had. Understand their growth goals. To say, if you want to achieve ... If you're a million dollars turnover, and you want to achieve five million dollars turnover in five years time, that's a huge growth curve. We're really going to have to dig right down into the analytics of how your business is driven. Not just what happens in the profit and loss for the income statement, not how much money they spend on entertainment. It is what is driving your business? We'd actually go okay, we're going to do a systems audit. Then as we get into the Cloud accounting. We'll get all your data correct. We'll hook up the top level system, whatever it is that's driving your business. We'll bring it together in a dashboard for you to understand the metrics and how whatever your key metric is at the top will drive the future to your five year goal.
Then you talk about it. You break it down. I'd never use the words strategic planning or business coach or anything like that. I literally just ask them what's their exit strategy. Every entrepreneur that starts a business is going to or should sell it one day. Whether or not they're handing it on to a next generation, whether that be merging with another company, whether that just be shutting it down, I mean that's still an exit. That's not a great one, but you need to understand what that end goal is for that person and what their personal gaols are as well as what to do to help them achieve it. Then break it all back down. This agile methodology. Break it down to very small little chunks and tackle one at a time.
That was the biggest driver of all the up-sells. It wasn't actually saying there was an increase in sales by the client. It solves us bending over backwards to try to figure out a way to help them. Once again, hitting that nail on the head in the iron basement. We'd spend our time and money to present it to the client that this is how we could help you solve it. This is what we've done before we had a resume in that particular area. It worked out great.
We initially didn't up-sell all of our clients. Some people were happy where they were. For the people who wanted to grow and had a very high or fast goal or just very ambitious or were growing rapidly, they were literally lapping it up. I think the other thing that is to never do is, we are so bad at marketing to just our client base. You do something amazing for another client, whether that's a business evaluation, a sale, whether it's restructuring their HR and getting involved in payroll and the metrics and understanding their revenue q. Where we very rarely talk about whether there is a case study or as a service we can offer to the rest of our client base.
If you think about even yourselves and your obstacles [inaudible 00:46:33]. You had a marketing company that helped you do some things. They did something new for a client of theirs, which is relevant to you and they told you. You probably asked to have the same treatment and happy to pay the fees, because they're proven. I think that's one other thing that's really, really key is to communicate your success stories. Even your challenges through your clients and how you solved them. It think the uptake and increase in services, whether it's at your end, whether it's they record. Whether its at the next meeting or just after they receive it now. It will drive your business faster than you can imagine.
One of the interesting things we said there, which is really that R & D expense, which goes back to why we said you need to identify who you are going to approach, because that is an expense. You want to make sure you are putting the right effort. Again, time is limited on the ones that are going to have the highest likelihood to convert and are going to be ones that you want to convert. It's really, really important with the.
We've actually covered this as you can guess through each one of the sections. I'm going to take this one Guy. I'm going to have you tee up the close.
Go for it.
Again, it's one of the things you talked about at the beginning, which was how you did that first client. You ultimately learned how to do the close.
We've actually covered this. Again, we did the 10 steps to value pricing in that earlier session. You can see that on firmofthefuture.com. We talked about this before. Again, the first one is do your homework. Guy, you just talked about this. Again, you are doing your homework anyways when you're servicing as it is. It's just about going a little bit further on that research journey. Ultimately, understanding what opportunity exists there.
Now, I throw up here and you chuckled about this last time we talked about this Guy, which is ask the 5 why's. Again, clients come to you, because they're looking for some help. It's a tip of the iceberg when they're asking for let's say tax. When you dig a bit deeper, you can understand it and uncover what is their goal. To your point, are they trying to sell the business? Are they trying to pass it on to their heirs? What's they're personal satisfaction it? Understanding what are the root causes for why they're in the situation they're in, where they ultimately want to go, and being able to align what you do to those goals ultimately makes it really easy for a client to be able to say yeah, I can see now how you can enable me to get there. Again, a lot of the passion and excitement around that.
Our next piece here is really recommended. We talked about that. If you've done your homework, and you've uncovered where do we want to go collectively, then it makes it really easy to understand. Well, what are we going to serve up? What can we offer that's going to ultimately get you there and be able to articulate that best?
You did this again with your research. This is the give to get. If you want to be able to get them on an ongoing basis, then you've got to show them the way. Give them a taste of what it is. That might be again some recommendations on what to do with the business and decisions they should make or need to make. Ultimately, get to then next step. It may be showing them what's your monthly summary is going to be, or your quarterly analyses.
If you give that once, then they understand what the service is going to look like and understand the value that it has. Then really on the backs of that is, you want to schedule the conversation. If your completing the project that's currently in motion, let's say it's the compliance work, the end of that you want to be able to have that conversation then. Tee it up for the week after. This week, next week, you want to do that at the close. It really sets up the ability to have that broader discussion. Then that leads ultimately to the value conversation.
Again, a lot of that is just listening. It's probing and listening to where they want go, what they really value? What is it that helped them start to drive their business? You, doing what you do best, which is providing your insights and recommendations back to this concept of showing and telling the thing that you've researched and the thing that you're going to give them. Educating them. Opening up to a little bit of how you do what you do.
Ultimately, how that helps them be able to have more comfort and confidence in their own business. You've got to set the tone. You've got to outline what your engagement looks like. How is this to work with you? What are the processes that we do? How do we train you? Ultimately, you are articulating your expertise, your processes, your services. That all builds confidence from that client on, now they're taking another step with you. They're very happy with the step that they've taken. They can now feel even more comfort. Well, these are the guys that can really help me get to that goal. I can really understand how all of that comes together. Then I can sit back and be spoon fed or get the information I need. I can get over the next step of my journey. Then again, it's that articulation of what success looks like collectively. Putting some understanding of the road map, for again, that person to be able to walk down that journey.
We've talked about the referral marketing bit. I'm going to leave that for the article you can read on it. That's all going to lead to the referrals, ratings and reviews. That conversation tees up the close ultimately. That's where you've got to get it going. You've got to move them past that line. I'm going to pass this over to you Guy. This is what you can do best. This is what you've known from your own history. This is what your current Practice Ignition is all about as well.
Exactly right. Thank Ian. What happens next with your clients is huge. Let's pretend we've done some R & D. We've prepared a quarterly CFO style dashboard for the client using one of the great tools like Spotlight Recording or Fathom. You've done that work. You've had this current meeting talking about the future. You've taken notes on where they want to head. The first thing you need to do is probably move them onto some kind of monthly CFO sort of schedule or quarterly.
Now, if your client has enjoyed your presentation and your charm, specifically from my experience they are so blown away at that the fact that you've done this, you're miles above any other service provider they've ever dealt with. How do we get this going on a regular basis? If your response is I don't know right now, I'll get back to you, you've got a big problem. You've just lost all the momentum you generated from all your hard work. A big thing to prepare for before the meeting is having a proposal built for your clients, so they can accept it in the meeting and get started straight away. Like anyone else in this world, their time poor. They're busy. If they don't get on things, they'll delay it, so on and so forth.
With Practice Ignition we help you basically have all of the prepped and ready to go. You can send it to your clients. They can actually accept it from their phone in the meeting. We actually have payments enabled, so we're a merchant effectively here in the US. We can collect other [inaudible 00:53:47] credit card details from your client securely and transmit that money over to you. They can pay you for that project work they need to get started to move them safely to the Cloud before they leave the office.
Even more so, when you have those conversations mid year, maybe they're moving from quarterly to monthly. They need you to start managing their payroll or other things where you can value add. You can quickly go into your existing engagement with your client. Hit edit and add in those new services. Send it out to your client with a change order. They sign off on it. We will automatically update and deploy invoicing work flow and payments. All of it just connected together.
Last thing at the end of the year, we make it really easy for you to review and roll over and send up proposals to all your clients. If your not having this conversation of how have you gone with your goals? How are you lined up for next years goals? Having that business conversation once a year, you're not only doing yourself a disservice. You will be leaving revenue on the table. You're not showing enough of an interest in your clients and not their trusted advisor. We help you to streamline the administration process of that, so it's not a burden. You can have those conversations, deal with quickly and send out your roll of proposals to clients to accept and line up for the following year. Whether that be on anniversary, whether it's the end of the calendar year, whatever that time frame is that you engage your client.
That's 6 steps that we used to ignite your practice. Like I said before, we've got the analytics at the top of that. Your stats surrounds service breakdown, revenue, visibility of future revenue, conversion rates, all that sort of stuff lives within Practice Ignition as well.
Good segway here. I'm going to launch a poll. If you're interested in Practice Ignition, just let us know. The quicker you answer the polling question, I'm going to go the CPE one after that. It's going to bring a little wrap up as well. Go ahead and answer that. I put some fun ones up there for you. Guy, this is a little bit of a shout out to you.
Yeah, I saw that. Thank you Ian.
No worries. I'm fan of the, I would rather watch paint dry. I'm just joking. Definitely give us the answer there. I'm going to close it down in a few seconds. We'll do that in 3, 2, 1. Close the poll.
Your cracking up.
Just so you guys know, paint drying did not win. It was very low on the ... You guys are a very good, fun crew out there. At this point also, because I'm going to get some folks talking about the CPE stuff. I'm going to launch that as well.
Again, while I'm doing the next bit, which is just a quick little wrap up here as you guys are answering. Today, we talked about the yearly problem. It's key in terms of who to engage. Again, if you're going to do the research, and you're going to do that extra bit of work, you better know which ones are going to give you the best value. Which ones are going to give you the highest likelihood to actually come across? Again, what to offer?
We talked about the up-sell. We talked about how that can tier across. We talked about the opportunities that exist there. Ultimately, laddering into the value and really understanding the value that can come across. The value that can come across is extremely important. We've covered this throughout the entire hour. It's critically important. T
here was a question regarding 10 steps to value pricing. It is up on firmofthefuture.com. However, if you don't see that, I'll give you my email at the end. Again, it's really about the close. I'm going to close the polls. You'd better get your vote in here in 3, 2, 1. Couple stragglers in there.
Again, that really goes into, we talked a little bit today. If you want to know more information about the ratings and reviews part, the costumer satisfaction, up-sell and cross-sell, go to firmofthefuture.com. They will be posted up in the next 2 or 3 weeks, as well as this particular recording. If you want to learn more about Karbon, we do an intro every Tuesday and Thursday. Again, those that mentioned that you'd like to hear more about Guy and Practice Ignition, they do a demo every Wednesday. You can go to either one of those web addresses down there karbonhq.com/events or practiceignition.com/events. It's good Guy. We both got similar URL string types. That's good for everybody to remember.
Nice and easy. Nice and easy.
It's got to be easy. Again, if you want to learn more, go to firmofthefuture.com. A lot of great content is going up there, literally as we speak. We're adding to that as well. You'll see that. A lot of this is to really help you overcome barriers in order to unlock additional practice growth or again, unlock your potential.
I'd like to put this up here. Again, Guy, I really appreciate you taking the time. For those of you who want to reach out, learn more or if you want to ask us questions about what we've talked about today, go ahead. You can email me at email@example.com. Guy I did not get your permission, but that is Guy's email. I was going to put his cell phone up there, but he's all over the world. You never know what time you're going to get him at.
That hotline is pretty expensive Ian. That's not a cheap rate for that one.
Again, go to practiceignition.com. You can email firstname.lastname@example.org. You can email me at email@example.com.
Let's go back. We've got a few moments here to look at any questions. We've been answering as we've been going, which has been good. Thank you Andy. You've been in the background doing that. I've answered a few. It likes we're relatively pretty good over all. We've covered it pretty much. I covered the question slide. What we're going to do here, it's a wrap everybody.
Guy, you want to say some closing statements, some words of wisdom for everybody before we close it out?
I think the research part is the key. I think if you're changing the way you do your business, you need to be willing to spend some time on it. The only way to break a cycle again is to make some changes, which can be a little bit harder and daunting. I think if you tackle your own business first, and think about what you want and where you're going, it gives you a pretty good foothold to have that conversation with your clients.
You do need to be very blunt with yourself on that assumption. You all are entrepreneurs as we've been talking about most of this session. Other than that, it's been an absolute pleasure talking. Like Ian said, I'm happy to answer any questions. Feel free to check it out, but I think they put you in a pretty good state to point you in the right direction at Firm of the Future.
I've got a couple of shades and things we do for the Aussie Firm of the Future, so I might see if I can get those for the US audience as well just to help bring some more content and true love.
Appreciate it. Hey, Guy. Thank you so much for taking the time today. Thanks everybody for listening in. I'll be back next month for another topic. I appreciate all the nice comments that people have been putting up on the questions board. It's really appreciated.
Thank you everybody. Have a great Tuesday. Again, if you got any questions, feel free to email us. We're here to help and much appreciated. Bye everybody. Have a good one!