Not all clients are created equal, yet all accountants seem to have the same client spectrum. At the bottom, there are the nitpickers, the time-wasters and energy drainers (also, usually the lower fee payers). Then, as we ascend the spectrum, clients get nicer, they understand our value and are willing to pay the fees. Lastly, at the top, we have our "golden egg" clients. The ones who make up the majority of our business, who come with a lot of referrals and opportunities, and who we typically tend to love working with. Does this sound familiar?
If you want to grow your practice, you need to find the value in your current client base. Once you know where the true value lies, you can then clone the processes that will help you land more of those golden egg clients. This article helps you do just that by showing you how to calculate your existing client value.
*This blog is an extract from our virtual workshop – How to confidently and profitably scale your practice in a recession. To listen to the full recording, download it for free here.
How to calculate your existing client value
1. Create a growth plan and strategy
We don't drive with our eyes closed, so why do many of us try to grow our businesses without a real plan or strategy? I know what you're going to say - "I have my plan in my head" - and while that's good to have a vague idea, it's not enough to scale your practice.
If you want to grow and actually achieve the goals that you set yourself, you need to have a specific growth plan and strategy that is written down and checked every week. Going back to the driving analogy, having your plan 'in your head' is the equivalent to driving somewhere completely new without your SatNav. If you have your plan written down, however, and you check your progress regularly, you'll get to where you want to go far quicker.
To create your growth plan and strategy, follow these steps:
- Decide on your ONE BIG FOCUS for the year. What is your overall goal? E.g. win X amount of clients, reach X amount of profit etc.
- Work backwards and write down what you need to do every month. Cut your goal down into quarters and then months. What targets do you need to hit to stay on track with your goal? Which tasks do you need to be doing every month?
- Write down the tasks/activities you will need to do every week. What do you need to be doing on a day-to-day basis to make sure you are progressing? E.g. daily LinkedIn posts, weekly check-ins to nurture client relationships etc.
Have you heard of that Alice in Wonderland quote, when she finds herself at a crossroads? The Cheshire Cat says, "If you don't know where you're going, any road'll take you there." While many of us think that having a vague idea of where we want to go and doing a bit here and there is enough, it's not. To achieve our goals and scale our firm, we need to have a clear direction, break this overall goal into bite-sized actions, and have a clear roadmap for the year ahead.
If you need help with this activity, download our free resource for How to create a 3-year growth plan.
2. Analyse your client portfolio
Now you know the direction you want to grow in, you need to identify the clients who will help you get there. Look at your current client portfolio and identify where the easy wins are.
To find where the client value is in your portfolio, make a spreadsheet and write down the following for each client:
- The work you do for them
- The number of hours it takes to complete
- How much you charge them
- What your hourly rate works out to be
- Whether they are easy, medium or hard to work with
- If you like working with them
- Whether you are happy to lose them.
You should now be able to see who you really like working with, who pays the best, and what work makes you happiest. This is a great way to gain valuable insight into how you want your firm to grow and who your target audience actually is.
Marketing tip: You've now identified your most valuable clients, so create client personas for them. For example, for your 'golden egg' clients (e.g. people who you enjoy working with, who give you the biggest bang for your buck), think about:
- Who they are (age, gender, occupation etc).
- What makes them who they are (level of education, location, family/marital status, personality traits etc).
- Their goals, values, and personal aspirations.
- What their main fears, challenges and pain points are.
- Their interest, hobbies, and passions outside of work.
- How you can directly help them achieve their goals/ease their pain points.
This is extremely valuable information (and in the next step, you'll see why).
3. Stop the side projects and distractions (and only target the high-value clients)
When you don't have a clear plan or growth strategy, it can be really easy to jump from one project to another. Especially in this current climate. We are all feeling drained and fed up, perhaps overwhelmed or lacking motivation. As you can imagine, this is wreaking havoc on our focus at a time where we need it the most.
To grow your practice during the recession, all you need to do is follow these 3 steps (and avoid getting distracted by anything else).
- Create a growth plan and strategy
- Identify your current client value
- Focus your marketing
You know where your client value is (your golden egg clients), so it really is as simple as focusing on these client personas.
In a recession, people are looking to work with an expert. They are tight on cash so can't afford any mistakes or work being done poorly. They are going to want a job well done, so you have to laser-focus your marketing message. It's no good trying to be all things to all people.
Use your client personas to focus your content on your website, social media, blog, comms, and pricing packages. Really tailor it to speak to their specific wants, needs, and challenges. As you can imagine, this is key to winning the actual clients you want.
Find your golden egg clients and grow your firm
Many accountants think that you have to keep winning new clients if you want to grow and scale your firm. While that's true to an extent, a far more valuable (and effective) way to scale is to find the value in your current client base. When you've identified these clients, you can get more from them (either directly or through a referral) AND you can use these clients to focus your marketing so that you keep winning more.
Trust us, there are already hidden gems within your client portfolio. You just have to find them first.
Learn how to confidently and profitably scale your practice in a recession
Download (for free) the workshop recording of 'Scaling your practice during a recession' and you will discover:
- How to gain the confidence and clarity to grow your practice
- A solid 3-step process for converting high-value clients every month
- How to find the value in your current client base
- How to reduce your overheads, but increase your practice efficiency
- How to find the time to work ON the business rather than IN it