5 Ways to Make Your Accounting Practice More Profitable
“I crunch numbers. I’m not a people person,” said no successful accountant ever. Here’s the double-edged sword about accounting. To succeed in the field, you need to bring in clients, do an excellent job for them, and then hope that they refer you to others. As this Forbes.com article puts it, “Critical to super-charging your accounting practice is the ability to bring in new, high-quality, well-paying clients on a consistent basis. Take a moment and think about how you’re getting your new high-quality clients today.” Because you likely have stiff competition in getting these clients, it’s not always easy to remain in the black, but we can help. Read on for five ways to make your accounting practice more profitable.
1. Share Things for Free
You might be asking yourself, “Wait a second, I thought we were talking about making money. How do I do that if I’m giving things away?” It’s simple. People love free stuff. Offer them information. If they find it useful, they are more likely to turn to you when it comes tax time. A great way to do this is to start a blog on your website. Write articles on things like taxes for freelancers, write-offs, and new tax laws. In doing so, you are establishing yourself as a thought leader in this area. And as a bonus, producing regular content also helps Google to keep crawling your website. This will help your SEO standing when people go to search for something tax-related on the internet.
2. Reach Your Clients
If you think social media has nothing to do with accounting, you couldn’t be more wrong. Social media rules just about everything these days, as it’s how you reach your target demographic. Again, people are what make you profitable, so if you’re not reaching them with information about your business—well, you do the math. If you’re in a small practice and take this on yourself, consider taking some online classes so you can learn the most effective ways and best practices. If you’re in a bigger firm, outsource this to social media marketing experts. Yes, it’s that important. Of course, you need to know how you’re trying to reach before you embark on your marketing efforts. As this accountingnet.ie article puts it, “If you have a tax practice that works with high net worth individuals, than [sic] someone with an adjusted gross income of $75,000 probably is not a target for your firm. And don’t use the excuse that young professionals can learn from these clients. It’s better that they learn from you.” Do the necessary market research to reach the clients you seek to land.
3. Examine Your Overhead
This is just as true in any business as it is accounting, and it’s crucial to remain profitable. Is your office costing you more money than your clients are helping you to bring in? Analyze this and make some changes if this is true. Can you have your employees work from home with smaller shared office space for client meetings? Think outside the box.
4. Invest in Technology
If you’re not up to date on your technology, such as the office computers, laptops, and tax software for accountants, you are already at a disadvantage compared to many other firms. Make sure you’re on the cutting edge of all things technology to keep your competitive edge and automate all available processes to improve productivity.
5. Use Metrics
When it comes time to choose an accountant, the people you’ve been trying to reach are going to comparison shop. It’s just a fact of life. People don’t even go out to dinner anymore without checking the reviews on Yelp. That’s why it’s crucial that you keep track of your profitability, the money you’ve saved your clients, and other financial standings that you think will help when it comes time to land new clients. Share these statistics online so that others can use this information to make their decisions. And because it’s so important to keep these numbers reputable, you also need to think about what do about clients that aren’t making you a profit. Analyze these clients and decide if another member of the firm should handle their cases, if you can raise the margins on them, or if you must cut them loose.
It’s a dog-eat-dog world in accounting. If you follow these tips, however, and work hard to reach your ideal clientele, your firm should be around for many years.