Attracting Very Small Business Clients

Attracting Very Small Business Clients

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I'd be really grateful for some marketing advice from the great and the good of the accountingweb.

I have been doing some thinking about the kind of clients that I most enjoy working for and I have decided to target very small businesses with my marketing. That is sole traders and limited companies with a turnover under £100k. I know the fees I can expect for these types of clients will not be huge, but I love doing the work and I enjoy working for the people. Also, I feel a have sufficient expertise and experience with these types of business to provide an excellant service. I just wondered if there was anyone else out there, with a similar focus and/or can recommend any really effective marketing techniques for targeting this sector?

Without boring everyone to tears, here is some background. I am a sole practitioner operating through a limited company and working from home. My only "employee" is my Mum who is AAT qualified and does the bookkeeping work for me (for free!). I don't do any traditional newspaper or phone book advertising. I have a reasonably basic website that is designed by me and so I'm quite certain is fairly unique. I have used targeted mailshots in the past with reasonable success and distributed postcards with fairly poor success. I get some referrals but not enough to grow as quickly as I'd like. I have been running a twitter, facebook and linked in pages but I am starting to doubt whether twitter and linked in will get me to my target market. Facebook might be more successful as many of my old schoolmates are in trades.

Also, I am aiming for a turnover of £50k per annum working 20-30 hours per week. My overheads are minimal and my chargeout rate is £50 per hour on accountancy work. I know the figures work on paper to make an turnover of £50k achievable but I wondered if it was realistic? CPD, Marketing, Practice Admin and faffing about on Accountingweb seems to swallow up a disproportionate amount of time.

Any advice would be gratefully received. Many thanks in advance.

SD

Replies (9)

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By petersaxton
21st Nov 2011 00:37

Some questions

Where abouts in the country do you live?

Do you live in a city, town, village or countryside?

What accounts production and tax software do you use.

What would you charge a limited company if they provided data on Excel?

I am guessing that you are not VAT registered.

I am in the London suburbs and would charge a limited company with Excel data, one simple personal tax return and one payroll run around £750 + VAT. Some pay me a lot more than that if there are complications. Most of my self employed clients pay less than half that. I have 5 bookkeeping clients who pay me around £5k - £7k per year.each and the work takes about one long day a month each.

I use Digita software and I do all the work myself.

I have a rubbish website which I want to improve but I don't have the time. Besides getting enquries from the website I only get referrals. I used to pay for Yell and Thomsons for book and online adverts but it's a waste of money. I have an advertising board above my garage door.

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By Steve Holloway
21st Nov 2011 09:38

Your aim is entirely realistic ..

I was at the £50k level for a few years before putting my prices up earlier this year. I would say my working hours reflect what you are aiming for too. Sometimes I work harder but other times of the year are quite quiet. For me the key was to get away from any work that I cannot deliver a decent return from ... that is bookkeeping, payroll, regular VAT returns etc. I know others make these work but at the end of the day I am better at accounts and compliance. £50 per hour is my target too and most of my clients are in hampshire/surrey which is probably an typical kind of area.

As for marketing ... who knows! I've got a nice website, easy to understand fees but 99% comes from referrals which have been built up over 11 years. 

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By Jekyll and Hyde
21st Nov 2011 10:02

In the past I have send out simple mailshot letters...

... to all potential clients in the area. This has been the only effective form of marketing that has worked for me. I obtain the listing from Experian (business listings) and in my letter i have informed the clients why they should choose me and included a brief profile of myself.

The ups are that they are reletively cheap, about 1000 letters for £500 - 600. Depending on size of client attracted I would get about 3 - 5 take ups and when my prices were lower than they are now I was taking up about 75%.In about 5 years I went form a £0 client base to £60,000 client base. For me the profile of the clients were exactly the size you are looking for.

You only seem to get a contact back if the client is reasonably interested in moving accountants. Don't ask my why but I did not get a lot of meetings where the client was testing whether they were being overcharged, under serviced. Perhaps that was because of the wording of my letter or perhaps it was because if they were not interested they just threw the letter awat.

The downs are that these clients are price sensitive and once you start to raise your prices you will not attract many new clients. In my experience, most of the clients I have obtained have stayed with me and about 70% - 75% are really good clients and I have managed to increase their fees where necessary. You do get the odd client that you get rid of after the first year, mainly due to the fact that they do not want to do things right and you have quoted a rather low fee (ie. £500 for a job you would expect to take say 10 hours, but you end up workng 20 - 25 hours on, but you also get this with any type of marketing).

It can take up to 18 months to get a response. I had a telephone call from a client in which he referred to a letter I sent spme 18 months ago. I was a little taken back at the phonecall, apologised to the client for being somewhat taken back and explained that I hadn't done any mail shots for about 18 months. His response was he liked my letter, but decided to give the accountant another opportunity but they had failed to deliver the following year and hence the phonecall. He is now a client of mine. I susposed my honesty with him on the phonecall possibly helped.

Mailshots are somewhat time sensitive. If you are growing your clientbase you may not have the time to deal with mailshots and you may need to increase you client base quicker than I have suggested. From my workings my client base increased by £5,000 in year 1 and then on average £15,000 per year for the following 4 -5 years. I was spending about £3,000 per annum on mailshots with only yell.com as my only other form of advertising.

 

 

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Man of Kent
By Kent accountant
21st Nov 2011 10:26

Chamber of Commerce

Have you tried your local chamber? This should be a good target market for you, also try any business hubs/innovation centres - bigger firms lurk here but I would imagine that you will be selling personal service/regular contact/fixed fees etc, if so this should be a good source for you - it works for me.

 

Referrals - as others have mentioned this is the best way to grow, you'll also tend to find that you get a better quality client too.

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By Sarah Offord
21st Nov 2011 12:27

Thanks!!

Thanks Peter - I am in Hampshire in a fairly rural village (which is quickly turning into a town!). I'm not vat registered (and keen to stay that way!). I use Moneysoft Payroll, VT Transactions Accounts Production, Xero Online for my bookkeeping clients who are that way inclined and the HMRC software for filing tax returns.For an average one man limited company (VAT registered) who gave me spreadsheets I would charge about £550 per annum and I work on a fixed fee.

Thanks Steve, that's exactly what I was hoping to hear!

Chesterfield, thanks for your post. I have used mailshots with reasonable success but I have only spent about £100 per mailshot. I think I need to invest a lot more to get where I want to be.

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By morgani
21st Nov 2011 13:05

My exact target

I've been targeting the same type of clients as well.  I started in May 2009 with next to nothing and am now around the £50k mark.  I have grown around £20k GRF this year and can expect the same next year as well.

Do think about your website and Google presence as although I get referrals around 70% is via my website.

My charges are similar although slightly cheaper (about £500) for a limited company but I am in rural Gloucestershire.  Closest town is 5 miles and Gloucester itself is 10 miles.

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By Moonbeam
21st Nov 2011 14:54

Me too!

I am also looking for the same type of clients as Sir Digby.

1.I am 4 weeks into a postcard campaign in 6 local postoffices. Results - dismal. Call from one person who wants to start up in business where she has no experience and thinks I can give all the answers free over the phone.

2. Amazingly, got excellent Hus/wife company from website. I would like to get SEO done on website but have been warned it would cost at least £200 per month and don't have the cash. Someone else told me to start a blog, as this was very effective for getting to the top of the list.

3. I have a quarter page advert in an A5 local mag and got one prospect from that, but he sounds as if he'll work his way around the competition beating down prices, so not for me. The Ad is in for 3 months and 2 of my competitors have been in it for years, so it presumably works long term.

4. Just joined 4Networking.

5. I am tempted to try mailshots as I used to do this for book-keeping work before.

6. Telesales - reluctant to try as I am driven mad by such people myself.

7. Local Chamber of commerce do's are attended by largely the same people that I know and don't particularly want to stand next to anymore.

8. Could be worth getting a simple leaflet designed and then posting through front doors locally over the next weeks/months.

9. What about running a local evening class on setting up a business? Maybe there aren't such things any more. Or giving a talk on setting up in business on some of the graduate type courses locally?

 

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By HASXX
21st Nov 2011 21:55

Hi,

I am in pretty much the same situation as you, trying to achieve a £40/£50K turnover working about 20 hours a weeks during term time. I have recently realised using someone for admin/bookkeeping means I can focus on the higher earning work and have more time for it!

I started just over 3 years ago and used yellow pages then but this has yielded nothing for the past 10 months so will probably not sign up again next year. I have also paid Yell to run a googles adword campaign but the response has been dismal so will stop after the new year. I am in the local newspaper (2 circulations a week) which is costly but have been in there for about 18 months now and although not many enquiries it has paid for itself with recurring fees and I feel that it gives me a permanent presence! I did postcards in windows but again very poor response (3 in total). Recently I tried mailshots and have gained 2 clients from around 150 mailings, one of them large for me. But my best response has been the 2 local community mags which always get a few enquiries when issued - for example one of them has just been issued (monthly circulation) and I have had 3 enquiries in the last week - one which signed up, one I am meeting this week and one a wait and see. Two of these are new start limited companies whom I indicated fees would be in the £500 to £1000 region dependent of exact services taken on. And finally after 3 years i am beginning to get referrals floating in! Networking and social media are not for me although I do have a basic website which needs livening up!

Sorry very long winded but hope it helps and good luck.

 

H

 

 

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By happy
22nd Nov 2011 11:03

How to get what you want

First of all no one is actually going to tell you what works really well (unless you are paying for the advice and it's not coming from a competitor)

All I'll say is what you want is absolutely achievable but stop thinking of boring traditional ways of getting business, mail shots, phone calls, letters etc are all so outdated. 

 

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