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Practice Comment by FD : How do you feel about fee conversations ?

23rd Sep 2014
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Our survey reveals that when it comes to fee conversations with clients only 14% of accountants feel uneasy . I must admit that I found this result surprising because the majority of accountants in practice don't think or act like businessmen. In the world of business there is often a lot of time dedicated to pricing per se and negotiations where price plays a crucial role.

Anecdotal evidence points to a situation where accountants often undersell themselves , so it looks like we have an interesting dichotomy ; we aren't uncomforable discussing fees but we aren't achieving the level of fees that we could be. So why is this ? 

Again , it revolves around the question of whether we are businesmen and women or "professionals" . I spend much time speaking to prospects interested in growing their practice and there is a recurring thread that runs through all my conversations. Namely that they have enough clients to keep them busy but they are the wrong sort of clients - ie these clients want a cheap service and cannot see beyond annual accounts preparation. The accountants cannot see a way around increasing their fees by any meaningful amount so they are at ease adding on a few percent to the annual bill but in reality are missing the real target. Hence the conversation is easy because there is no major shock for the client.

I advise these prospects to move the conversation forward in terms of how they can help the client grow their business , focusing on business advice rather than compliance alone. This will involve some hefty fee hikes and it is at this point that many accountants stall . It is out of their comfort zone.

What they need is a mentor for their practice to hep them move forward but they don't want to pay for this service . Why not ? Many people who I speak to tell me they have already paid out a lot of money on marketing and it either did not work or brought them lousy clients . However, the game has moved on and a more holistic approach centred around a website that works combined with proper use of social media is what they need , and that doesn't come without costs.

Perhaps it is about time we felt less comfortable with fee conversations then we'd sit up and take notice of what is really needed for our practices to truly prosper.

FD started out as a UK limited company registration agent in 1994 and remains a market leader. FD is now split into specialist divisions for company restoration, practice growth advice and practice sales, electronic company registers and client ID checking

www.formationsdirect.com

Tel : 0161 798 9999

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