#1 Reason Accountants Fail to Build Advisory Practices
What is the number one reason that accountants get stuck providing transactional services?
Now, I’m not one of those gurus that preaches mindset and how if you want something in your life, all you have to do is visualize it. That’s not the mindset I’m talking about here. I’m talking about the mentality that accountants “feel bad” for charging someone for their expertise and advice.
While this is not a new problem, it has bubbled to the surface amidst the Covid-19 crisis. In the vast majority of my conversations with firm owners recently, I hear the same line over and over again, “I’ve spent so much time talking to my clients about loans and explaining their options that I’ve hardly gotten any tax work completed. Now, I have to charge them $1,000 for those conversations, and I just don’t feel like I can do that because I know the financial situation they are in right now. I feel bad.”
What?!?! You spent your valuable time researching all of the different loan programs, evaluating what is best for your client, providing them options to help their business survive the crisis, not to mention any necessary documentation needed to acquire the loan, but you feel bad charging them for this? This is precisely the type of service that accounting firms are providing to build highly successful advisory practices. If you feel bad about charging for this type of service, you definitely have a mindset problem. Get ready for some tough love because that is the only way to break this mindset.
When I hear someone say that they feel bad about charging someone for advice during the crisis, my response is simple:
“But what would have happened if you had not helped that client secure a loan?”
“Did they not call you asking for your help?”
“Did that $1,000 save them from having to close their business for good?”
The bottom line is that $1,000 may have just saved your client’s life-long dream and business. They came to you for your advice because they see you as a trusted advisor. Your client doesn’t expect to get this information for free (and if they do, that’s an expectation that you set that you need to fix). The information and advice that you provided your client is something that they couldn’t do on their own. Your help throughout this crisis most likely means the difference in their survival or shutting their doors forever. That is definitely worth $1,000.
If your goal is to move away from transactional work and into an advisory services role, there is a distinct mindset shift that has to occur. Providing advisory services means that you aren’t necessarily providing your clients with tangible products like a tax return or audit. Selling advisory services means that you are charging someone for your thoughts and advice. You are selling them the years of expertise that you have built with your career in accounting. You need to get comfortable with charging more than $1,000 for your advice if you want to build an advisory services-based business.
In order to transition to an advisory mindset, think about the following questions:
- What value do I bring to the table? How can I help my clients?
- What do my clients struggle with the most that I can help prevent/resolve?
- Can they do this on their own? If so, how long would it take them? Would they do it effectively/correctly?
- What happens if I don’t offer these services to my clients?
The truth of the matter is, your clients crave advisory services, and if you aren’t providing them, they will find someone who will. Compliance work has become a commodity, and the real reason someone chooses to work with an accountant now is for the valuable expertise they can provide. If you are still struggling with the thought of “selling” someone additional advisory services, look at it from the client’s perspective. Stop thinking of advisory services as something you sell. Your advisory services are simply new ways to help your clients. Sure, they pay for these services, but the services and advice you provide will save them so much money or time that the price they pay is a drop in the bucket compared to the value they receive.
It’s time to stop thinking about selling and start thinking about helping. Your clients want to pay for your advice and value your opinion. Step outside of the compliance comfort zone and re-examine all of your clients for new ways to help them either solve a problem or support a goal. When you make this simple mindset shift, you will open up entirely new revenue streams, and your advisory practice will skyrocket to success!
Need a little help getting started? Download a list of Advisory Services currently being offered by other firms here: List of Advisory Services