Sell Value, Not Time
There’s hot discussion about Intuit’s recent bookkeeping services test, called QuickBooks Live. Many small bookkeeping firms worry that Intuit plans to offer bookkeeping services. Losing clients is their primary concern. Can a small firm truly compete with an enterprise business?
Those concerns that spread through social media strings were not based upon fact. Joe Woodard, from the Woodard Institute interviewed Rich Preece, Senior Vice President and U.S. Country Manager, QuickBooks at Intuit. The company doesn’t plan to compete with accounting professionals.
That’s great news for accounting professionals. However, the initial fear response, and how to proactively resolve that fear, is worth a deeper look.
Fear triggers a reaction, causing higher level thinking to shut down. As a result, the desire to resist change becomes even stronger. Technology and automation can now do the basics. Bookkeepers who avoid the inevitable will experience the same outcome as travel agents that couldn’t compete with Priceline.
However, it doesn’t have to be this way. In order to remain viable, the solution focuses on higher level advisory services.
It boils down to three things.
- Ask a different question.
- Your business model.
- Your customer market.
Ask a Different Question
You can’t compete on price. Therefore, you want to ask a better question. What changes can you start to put in place now so you’re well-positioned once Intuit offers bookkeeping services?
Break with Tradition
The traditional bookkeeping firm offers ala-carte services. With that model, time determines the cost of each service. As a result, the rate for services remains open-ended rather than capped.Talk with any client and you’ll quickly discover they’re far more concerned about their time than your time. #getpaidwhatyoureworth Click To Tweet
This backward business model emphasizes your time. Talk with any client and you’ll quickly discover they’re far more concerned about their time than your time.
Spice Up Your Business Model
Savvy accounting professionals realize what their clients truly want. The traditional way of offering their services isn’t the best business model. Rather than trade dollars for hours, become more client-centered. Lead with what they value rather than what you value.
The value conversation can seem confusing at first. Here is how DuctTapeMarketing plainly explains value based pricing:
“Here’s what I’m going to do, here’s what you’re going to do, here are the results we can expect and, by the way, here’s what it costs.”
Don’t Work with Everyone
What if there are more than enough clients for everyone? You can effectively capture your fair share once you define your ideal client.
Consider the travel agents. The ones who remained in business targeted an ideal client that didn’t want to deal with Priceline. Those agents found clients who weren’t price sensitive. Many of these clients highly valued their own time. They happily handed over their travel requirements to a trusted professional.
What does this mean? Well, many small bookkeeping firms cater to everyone. This ignores the fact that the marketed is hugely diverse. Different types of clients develop different needs, wants and desires.
Packages Offer More Customer Satisfaction
I empower my clients to package their services. They consider the various needs for each type of client they serve. Then they develop packages which address the specific needs for that ideal client. It’s why value based pricing is highly effective.
Glen, a local attorney, started to search for a new bookkeeper. He meets with Nancy to discuss his bookkeeping needs. As she guides him through a value consultation, she discovers that he needs payroll and tax services too.
He didn’t realize that her firm offers all of these services. Toward the end of the consultation she describes her 3 packages. Together, they review the differences and discuss which best serves his needs.
Although he originally came to her for bookkeeping, she’s now handling his tax and payroll too.
Nancy charges premium prices for the package that offers all three services – bookkeeping, taxes and payroll. Her two smaller packages don’t include all three services.
When clients review her packages, they don’t attempt to negotiate her price. Her small bookkeeping firm doesn’t cater to potential clients who are fishing for individual services. They’re simply not a good fit for her.
Examples of Packaging
As consumers, we purchase packaged services all the time. McDonald’s customers love to buy the classic meal deal since the fries work well as a side and the Coke washes it all down.When a client looks for services, what they really want is an easy fix. Packages bundle everything together, offering a one-stop solution for their business problems. #getpaidwhatyoureworth Click To Tweet
Telecommunication services offer phone and internet services together because a large number of customers want both. Similarly when a client looks for services, what they really want is an easy fix. Packages bundle everything together, offering a one-stop solution for their business problems.
Clients Have Different Needs
Not all clients need the same level of service. A tiered package system solves that concern.
Consider the 3 types of clients a small bookkeeping firm serves.
Start-up Business – New businesses need more basic tools. Since they’re tight on funds, they’ll appreciate a starter package. Consider the tools, systems and guidance that set them up correctly. As they ramp up, they’ll eventually upgrade to your next package.
Growth Phase – Growing businesses require more tools, reports and guidance. This package adds in more frequent reporting, more complex analytics and advisory services to strategically grow their business.
Mature Business – They’ve successfully navigated from growth to stability. Do they continue to push for expansion, consider a lucrative merger or prepare for exit? They want your premium services that solve these specific business problems.
Protect Your Firm from Cut-Throat Competition
That’s why Intuit’s bookkeeping services doesn’t mean doom and gloom for smaller agencies. Rather, it’s an opportunity for these small bookkeeping firms to elevate their business model. Attempting to compete with Intuit is futile.
Similar to a recession, some businesses significantly grow during a downturn cycles. That’s because many firm owners will resist any sort of change. They’ll simply close their doors. Or, respond too late. The firms that recognize the hidden opportunity will position themselves to gain a portion of that market share.
Follow these five steps to adapt and grow.
- Client. Start to redefine your ideal client.
- Choose. Choose a niche that values customer service more than price.
- Customize. Develop packages that resolve their exact needs, wants and desires.
- Communicate. Educate your niche about your expertise.
- Claim. Position your bookkeeping firm as a trusted advisor.
Provide consultations in your packages. These clients value your insight. They recognize how the insights you offer can quicken their growth and avoid costly mistakes.
Don’t Blend In
Average firms blend together. Your ideal client appreciates a client-centered approach. Consistently be mindful about what’s in it for them. Start to emphasize the results and benefits. It is one of the strongest marketing tools you can use to attract high-value clients.
You don’t need to sell your time. The “going rate” in your industry discounts your expertise. Seize the opportunity that’s been handed to you.
Start to raise the standard of your small bookkeeping firm. If you’re ready to package your services and increase your rates without losing clients, then schedule a complimentary consultation with me.