While you may be working in your practice day-to-day, it’s also important to step back and work on your practice. And there’s no better time to do that than the end of the year when things are a little slower with your clients, but the busy tax season is just around the corner.
If you want your practice to grow and thrive, taking the time to intentionally build it each year will pay dividends. Not sure where to get started? We have a list of ideas to help you get started.
Is your pricing model still serving you and your clients? When you started your practice, you may have gone with a pricing strategy that felt simple. But as your practice evolves, your old pricing strategy might not be serving you as well as it could.
For example, rather than charging a flat rate per return or charging per hour, it might make sense to start bundling your services. You would save time billing and get paid for the additional work that your clients need.
While you are reviewing pricing, you’ll also want to review how much you charge and see if it’s time to raise prices. Reviewing pricing — and making sure you’re not underpricing yourself — should be something you regularly review.
Are your clients returning to you year after year? Or is there a noticeable decline, where you find yourself constantly needing to bring in new work to replace clients that have gone elsewhere?
If your client retention rate — the percentage of clients who remain with your practice year after year — is low or declining, it’s time to investigate why. Studies show that it’s between five and 25 times more expensive to go out and get new customers rather than retaining the ones you currently have.
Before you spend money looking to acquire new customers, you’ll need to learn why your clients aren’t sticking around in the first place. One simple way to do this is with a client survey. In the survey, you can ask clients to rate how satisfied they are with certain aspects of your service, like communication or level of responsiveness.
Don’t take the feedback personally — look for areas where you can improve and start making changes to your practice to make those improvements. Measuring client satisfaction and retention annually can help you see if the changes you’ve made are having a positive impact on your practice.
Let go of low paying work
You may have certain clients or a type of work that doesn’t suit you anymore. That work might be low paying work that doesn’t fit within your business model anymore. Maybe you’re doing it because you’ve always done it, and you feel bad letting it go. Or maybe you’re worried that letting go of low paying work will damage your bottom line.
Take a hard look at your low paying clients or type of work and consider what you can do with it. Would it be better to outsource this work to someone else? What if you let it go completely — would that free up time in your practice to take on more, higher-paying work?
Getting rid of low paying work can be a process that takes time. You may choose to phase it out or stop doing to work all at once. If getting rid of low paying work makes sense for your practice, make a plan, and stick to it.
Focus on marketing
Marketing is a challenge for many people, but it’s an important part of growing your practice. Good news: you don’t have to launch a big marketing campaign or spend a lot of money to impact your marketing. But you do need to be intentional with the marketing that you do. Here are some ideas to get you started:
- Update your digital profile: One of the first things a prospective client will do is look you up online. Without an up to date website (or worse, any website at all!), your practice will look out of touch with the times. Spend time updating your website to clearly state what you do and who you work with. Also include an easy way for prospective clients to contact you.
- Update your email communications: Your clients want to hear from you. Work on sending them timely, relevant emails with the information they need to know (for example, new tax updates). At the end of each email, ask them to share with a friend who could use the information.
- Ask for referrals: A successful practice can often grow through word of mouth referrals. But you may need to remind clients that you are happy to receive referrals. This doesn’t need to be complicated. It can be as simple as saying, “if you’re happy with my services, I’d love it if you could refer me to anyone else who you think might benefit from working with me.” It’s a no-pressure reminder.
During certain times of the year, tax preparers are crunched for time. And how you handle that time crunch will impact whether you can grow your practice.
Before you get busy, it’s important to walk through your processes and figure out where your practice can become more efficient. Are there steps in your process that can become faster with automation? Do you need to hire an additional resource to assist in a certain task that is a bottleneck in your workflow?
If you have some time to really dive into your workflow, first read The Goal, a management novel that is assigned at many top business schools to teach students how to identify and solve bottlenecks in business. It’s a light read with important lessons that can help you run your practice more efficiently.
Build professional relationships
Networking is one of the best marketing tactics you can use to grow your practice. But many people don’t like how forced networking can be. But remember: good networking is about building genuine relationships.
Need some inspiration to help you figure out just how to build those relationships? In his Ted Talk, Adam Grant breaks down the personalities of givers and takers and offers strategies for how to be a giver. Especially easy to execute is a strategy he learned from serial entrepreneur Adam Rifkin. The strategy — coined the five-minute favor — is the act of carving out five minutes in your day to do something helpful for someone in your network.
That might be connecting a lawyer with a client who needs assistance or giving an endorsement to someone on Linkedin.
Five minutes a day can help you build genuine relationships that will help your practice grow for years to come.
Grow with your clients
While your clients may first come with you to file their taxes, their needs will likely evolve. They may start a business and need help doing financial projections and making important financial decisions. They may get married or have children and need help assessing what the right tax moves they should make to lessen their final bill are. Or they may need an advisor to help them navigate investments and financial planning.
If you want to grow your practice, consider how your clients are growing. Where does it make sense for your practice to evolve as well? You might want to add on CFO services or consider bringing in Avantax Wealth Management services into your practice.
If you want to grow your practice, it takes time and intentional action. Growth won’t happen overnight, but when you regularly look at tactics like those listed above, you’ll find slow and steady growth that creates a thriving tax practice.
All TaxAct offers, products, and services are subject to applicable terms and conditions.