I know there are plenty of similar posts, and I've read 90% of them at least 3 times.
Qualified in practice, also worked in industry. After redundancy about 18months ago I started offering my services, a family member signed up immediately, which bagged me a fee of around £500 a month.
However, since then, its been very very slow, the last 12 months have seen me invoice £9,000, now £6,000 of that is due to a family member, so that leaves me with only £3,000 of fees I actually had to "win", which two thirds of which came in January.
I have been marketing my behind off, Networking, SEO, Adwords, Printed Ads and so on.
I am anxious that the next 12 months will be the same, it all feels like a bit of a joke at the moment. :(
Replies (54)
Please login or register to join the discussion.
I am not an accountant, however a soon to be IT provider.
When I was looking for accountancy help, I saw a lot of big firms charge a lot say £2,000 once off for say return and submissions.
Browsing some further, you see pay monthly which are "affordable". Look at Crunch's pricing tables.
Would you offer fixed fees or all inclusive monthly payments? Could this be an option to bring in sales?
No worries.
How about trying this monthly plan by putting new or existing clients on an affordable monthly plan. This means your cash flow is always coming in regardless of when their YE etc. is. Taking the money by Direct Debit and providing them with services when they need.
Cashflow could be better for you, as you have regular monthly payments rather than one off.
This world is slowly becoming a more subscription model, how many subscriptions do you have?
Hope this helps.
Alex.
I think accountancy practices are one of the hardest businesses to get off the ground. They're based on referrals, so starting point of zero clients makes it very hard...but if you can get past that, it can snowball.
It's impossible to guess where you might be falling short from some text on a forum. Are you getting a few introductory meetings with potential clients where you give them a quote? If so, and you don't get the work, have the courage to (politely) ask if they have any feedback.
Do you have a niche? If you're trying to appeal to everybody, it's easy to appeal to nobody.
You have my sympathies. My first year was far harder than I anticipated. Eventually a few things fell into place, then I got involved with FreeAgent and it blossomed from there. However, I think that's a ship which has sailed so you'd need to find your own version. Good luck!
Signing up 80% of those you meet is certainly a decent hit rate. So presumably the issue is more how few meetings you manage to secure in the first place?
Perhaps worth getting someone to do some marketing/lead generation for you, that you can then try to close? Though there is a risk you end up wasting money on this if the leads end up being rubbish.
Easier said than done, but if you can work out a decent niche, you can be in the enviable position where people search you out and are virtually sold before they get in touch.
I think I had about 5 clients in my first year, it is really hard starting from scratch.
Read all the posts on here about marketing, networking etc. Unfortunately all the commercial skills have to be picked up along the way.
Use this time to set up good practices to make everything efficient. You don't have to continue, you could go back to the day job or try sub-contracting.
It does pick up, mainly through referrals.
There is a lot of luck involved, make sure you let everyone know what you do and post in local Facebook groups/business groups since this is free. There are loads of young people becoming self-employed and so find out which groups they use.
Are you seriously crap at marketing and, if so, could it help, to be part of a franchise?
Could you buy a tranche of fees?
Could you invest in professional marketing services, telemarketing, mailing lists etc. ?
The thing is, small incremental growth just isn’t going to be good enough in your position. You don’t even have the excuse of being the new kid on the block any more.
I think you need to work on a dramatic change and that might take some serious money. You have already lost tens of thousands of pounds over the last 3 years by foregoing the income earnable from a permanent employer.
Tranche fees, I have thought about that, but I think I’d rather put the money into marketing. Professional marketing could be worth looking into.
I don't understand that comment. You would rather spend a lot of money to potentially earn precisely nothing, rather than spending some money to acquire almost guaranteed income? (unless you fluff it up big time once you have bought the fee base).
If you are getting 80% sign up (you mentioned earlier) then why are you not leveraging introductions from these people?(the best source of growth in so many ways)
[quote=andy.partridge]
Are you seriously crap at marketing and, if so, could it help, to be part of a franchise?
Sorry but I don't think that was very politely written.
I don't advertise and get the majority of my work as word of mouth. I use Facebook occasionally and I am on LinkedIn but neither of them have I had new clients from. I don't have a website up and running. When I did for many years it didn't bring me new clients. Word of mouth has played a big part.
It takes time and effort. It won't always be slow. Lots of people need accountants and likely to be more needed with the new MTD that will affect everyone next year.
Are you seriously crap at marketing and, if so, could it help, to be part of a franchise?
Sorry but I don't think that was very politely written.
Oh, do shut up. The OP knew what I was getting at so there is no need for you to be offended on their behalf.
Thank you. I am sure they did understand you but nether the less there is no need for rudeness in this discussion. Including you telling me to 'shut up'.
In my professional opinion the OP needs a push, not delicate stroking. There was no rudeness to the OP - look at the context with other responses made - but any rudeness to you is intentional and well-deserved.
Assuming that you're not vat registered then use that to your advantage.
Target non-vat registered sole traders and companies. Offer to do the work for 80% of their present fee AND NO VAT.
Tell them you'll be 40% cheaper and hope that arithmetic isnt their strong point.
If you can give it three years, then it snowballs. You suddenly start getting three new jobs at once. GL.
There is a lot of good advice given already, and you have clearly tried to sell your services. Most business should come from referrals but if you do not have many clients as yet, then how do you get referrals?
I think you need to make yourself stand out in your area by giving yourself a high profile. Get the local paper to publish an advertorial to promote yourself, join local business organisations, sit naked in the town square, set up and sponsor a run, but one way or another let people know you are there and you can help them.
MAKE YOURSELF STAND OUT!
It is hard work, but the rewards should be long term. I have not advertised for over 1o years now, but still potential new clients come to me all of the time although I am very particular about who I take on these days.
It's very tough finding new clients. What some people say works for them doesn't seem to work for me, and vice versa. It's taken me years to build up even quite small numbers.
Have you thought of looking for a part-time role to finance yourself through these dark days? I've got a huge client like this and that takes the pressure off. In your case you could look at part-time accountancy jobs where you could do the work from home as a non employee. There are always some of those around if you keep looking.
I'm just started investing heavily in seo. Good quality people are beginning to contact me via the website. But it all takes time. It's costing me £300 a month for this and I insist on rewriting the poor quality pages I get asked to approve (but I was prepared for that at the start).
I've gone for part-time positions in the past, and told the business I'll do the work from home. Many of them were happy for me to take them on as a client on that basis and found they could get hold of me any time in the working week for queries rather than just on a set day and found the whole experience better than me taking up deskspace in their offices. That's what I was thinking of for you. I know we've got to bear in mind IR35, but think it could be do-able if you're careful.
Offer a free hour MTD appointment locally for anyone VAT registered and not ready. See if you can pick any work up from that.
You are not alone, most of us have been where you are - I certainly have.
Year 1, I sent an email round to all the local accountants, telling them what I can do, and asking for subcontract work. I got lucky and a local firm offered me a couple of days a week doing tax work. This allowed me 3 days per week to build my practice whilst retaining some income. Without this, I would have had to at least take on a part time employed role.
If starting from scratch, ie, no subcontracting, no employment to prop you up financially, you really need to have enough savings to support you for at least 12 months.
I already had 2 clients when I started the subcontracting, one paying 200 per month and one paying 80.
I then began direct marketing, which had around a 1:100 hit rate. This gave me a handful of clients in year 1.
Year 2, still subcontracting, I started a referral scheme whereby I wrote to the handful of clients asking for referrals and offering a referral fee. This brought in around 2-3 additional clients but nothing more.
I was however fairly comfortable, as I had proved my worth as a subcontractor and was doing extra hours during their busy times, so I had around 500 per month from clients and 1500 per month from subbing. With my partner working aswell, this was ok.
Year 3, the subcontract work came to an abrupt end and my partner had just fallen pregnant. I was well and truly in the fertiliser.
I made the choice to carry on building the practice, full time, with my partner bringing in some income from her job. Without this, I would've had to go back into employment. I'm calling this year 3, but technically it was my first year of working in the practice full time, ie no employment or subbing.
I had indeed gone backwards.
I had no money for marketing and so decided to learn how to build my own website. I put everything into this, spending day and night learning / researching, particularly about SEO and then slowly and painstakingly built a site. It took probably 6 months to get it looking ok. I continued doing a little bit of direct marketing and some very limited Google AdWords and was picking up around 1 client every 2 months (it was very slow).
The next year, I hit the 1k per month turnover level which felt good. It was nothing really, but having achieved it from nothing, it gave me the impetus to carry on.
Around this point, I decided to get good, solid systems in place, so I invested in practice management software and other bits of software, as well as becoming a Xero partner.
We had enough income to cover outgoings (between us) and each new client was a step in the right direction.
The next year, to my amazement, I started getting calls from people who had found the website. We were rising through the ranks on Google, sitting at around 4th place for accountants in the local small town. The website had cost very little to build and I was beginning to see the fruits of my intense labour (I spent so long building the website and learning all about SEO that it almost resulted in divorce). I became obsessed with 'getting it right' at one point.
I was becoming busy, although still wasn't earning more than 20k.
I had to at this point remind myself that I did not want to become a busy fool, and I became very selective about which clients I would take on. I let quite a bit of the low hanging fruit pass by, choosing instead to keep the pace slow.
In conjunction with this, I began quoting decent fees, which resulted in a reduction in post-quote sign ups. I persevered.
The following year I was still reaping results from the website, aswell as getting some good referrals (although not as many referrals as I expected).
Eventually, after a long, slow start, things all of a sudden took off.
3 years after going it alone, full time, and it just snowballed.
I now don't do any marketing at all, and am still picking up (on average) 1 client pet month.
As has been said by another poster above, building an accountancy practice is far from easy. It is worth it eventually though, if you can find a way to get through the first 2-3 years (may be less, may be more, but the hardest is year 1, with hardly any income), you will eventually hit a point where you are getting a steady stream of clients.
Each year gets better. Use the early years to set solid foundations, so that you have systems in place ready for when you need them.
Try and find some subcontract work to give you some cash flow.
Of course, there are alternative models, such as the franchise route, or obtaining finance and buying blocks of fees.
I wish you all the very best in building your practice and would urge you to persevere. What you are experiencing is not unusual, and if you can break through the pain barrier and stay motivated, you will get there in the end.
A very good post.
"I had to at this point remind myself that I did not want to become a busy fool, and I became very selective about which clients I would take on. I let quite a bit of the low hanging fruit pass by, choosing instead to keep the pace slow.
In conjunction with this, I began quoting decent fees, which resulted in a reduction in post-quote sign ups. I persevered."
This is an extremely important point. There is no future in taking on work at a low rate just to keep things going. Always quote a rate at which you will make a decent profit or turn the work down. Time is essentially what you are selling and that is limited, so make each hour a profitable one.
Bear in mind, however, that although you may actually work 9 hours a day, you will be lucky to bill 6 hours as your business administration and non-chargeable work will always require your time as well.
Buying fees comes with some degree of guarantee though if you are careful with clawback provisions. If the owner stays around to help changeover, that shouod help retention too.
We have found marketing to be useless and dont do anything now apart from adverts to support good clients. We get everything from recommendation and having that base helps create that.
We have bought fees three times in our work life. One actively and the other two times to help people out who had to retire early for health reasons. We kept about 1/2 and over the years that half remianed loyal, so it was a good idea for us. We had strict clawback deals though.
I agree with others it does get better. I have been fortunate after a slow start it has really increased and in a position where I wanted to be and now turning down work.
If you on the South coast (as your name suggests) same as me then it is a extremely competitive market. When I was struggling a few years back. I counted the number of accountants in a 5 miles radius it came to three figures. I found that really depressing and thought how am I suppose to compete in a overcrowded market. Luckily, I carved out a niche so do not necessarily have to compete against local accountants. Sure you have an area of expertise.
Just give it time and think outside the box for marketing techniques you will get there in the end. I am sure you will post your success story on accounting web in a few years times when answering a similar question. Good luck.
Ok, you have to decide if your ready for self-employment. It is a culture shock. You have to get the work, do the work then get paid. Does your confidence come over at meetings? Can you handle all the aggravation that self-employment comes with? Going into any business has not and is not easy and if the first year is getting you down, perhaps you are not cut out for it. It appears that as you were made redundant, self-employment was perhaps not your first choice, merely a "lets try it out" scenario.
Now for the positive. Be alive, be enthusiastic all the time. Look for opportunities and don't turn anything away (there will be plenty of time for that later). Embrace self-employment for the benefits that come from it. No, the benefits don't arrive on your doorstep, you have to go out and earn them, but what a feeling you get developing your own business.
These days there is no middle ground, so the choice is yours. I wish you all the best whichever way you go.
I have been in practice many, many years, as a sole-practioner.
In my experience, the best way by far to acquire new clients is by personal recommendation from an existing client.
What has worked for me over and over again is...
simply asking clients for help in building/ expanding the practice. Good people love to help other good people.
Always, always thank clients for their recommendations, remember birthdays and Christmas.
Hope this helps.
I have been a practicing accountant for 18 years now. It took quite a few years before I was earning anything. I had the financial support of my husband so that really helped. I would stay stick at it if you love it and can financially manage.
I am not sure but my experience is the reverse.
I started off with no clients. If I didn't get any I wasn't going to eat. So I snapped up a couple of days as a subby. Well I mean I said I would do some time as a subby, but I signed up so many new clients 4/5 a week that only lasted about a month. I was too busy doing my own work.
I started 19 years ago and more or less have grown at the rate of £85k t/o a year. As a guide I did 16k of new clients in February.
Everywhere you go everyones a potential client.
The guy in the icecream van.
The kiosk in the railway station
The dude who fixes your fence
The plumber who repairs your tap
The bloke you meet on holiday.
Get out more.
Don't go to speed networking etc that never works, lots of sellers and no buyers.
Don't advertise where everyone else does... too competitive.
Join the civic society, the squash club the tennis club just do stuff and meet new people and they turn into clients.
Talk to them and just give them a load of free advice on how to keep their taxes down and they just say things like... wow my accountant didn't tell me that... then you more or less have them.
One day you wake up and the problem is where do I get the decent staff from to do all this work rather than where do I get the work from... and then... you know you have succeeded.
If you are running up personal debt then probably yes, if you are managing to live however frugally it is worth sticking with it things will improve.
I echo the point about niche marketing, this can be effective and more cost efficient, what industry did you work in previously? maybe try to exploit your background, also monthly billing is essential.
Sending a personalised letter on nice paper using a decent laser printer through the post to the local accountancy firms worked for me. Only a few replied but I picked up enough bookeeping / sub-contracting work to get some decent money coming in in the early months.
yes, because you cant find enough good staff....and then they get stuck and you help them with technical tax questions and invite them to the xmas party etc and then one day they get an audit client or some due diligence they cant do and hey presto £12k of fees
Is it time for me to pack up?
Time to move back to employment?
There's some good advice here and some good stories too of how hard it can be to build up a practice.
Equally there are lots of ideas here for marketing TACTICS that 'might' work if done effectively. Or that may be a waste of time, effort and money if not done well.
Can I suggest going back to the start. Given what you now know, do you REALLY want to be self employed and try to build your own practice? If not, then take your first year as a wake up call, be honest and fair to yourself, pack up and get a job.
If, despite your frustrations, you are committed to building your own practice, then you absolutely need to do things differently going forwards.
I highly recommend getting as copy of Della Hudson's book: The Numbers Business and taking on board the advice she gives to start-up accountancy practices.
I have also shared advice to help start-ups on my blog. Try these for starters:
http://bookmarklee.co.uk/10-key-actions-you-need-to-take-when-starting-a...
and
http://bookmarklee.co.uk/key-tips-for-new-accountancy-practices/
Good luck whatever you decide to do next.
Mark, we nearly agree. My only thoughts are that if you are in as business as an Accountant (someone who others look to advice from) should you be reading books on start-ups? As an Accountant, start-ups look to us for the advice. If you need a book to teach you how to start your own Accountancy business then you really shouldn't be a self-employed Accountant. My gut feeling is that South Coast should be employed where he could use his experience in his first year to further develop his Accounting skills.
When it comes to start ups, an accountant may well be better placed than many to know whether sole trader or Ltd Co is best...but typically they won't have any practical experience of marketing/selling. It's all very well knowing your tax/accounting stuff, but if you can't convince others of that, you're going to struggle. No shame at all in reading multiple biz books IMHO.
I think you and I have a different idea as to what an Accountant in Practice is. That first meeting with the prospective client is the most important (in your language it'll be "closing the sale"). The client has to know that you know what you are talking about. That doesn't come from reading marketing gimmicks, it comes from hard earned experience. Unfortunately passing exams and reading biz books doesn't give you that (although it can add to your skills).
I'm a great believer in learning, but from talking to clients and real life situations.
Whilst it is clearly tough in first 18 months or so I would say you progress has been very slow.
If you have only got £3000 of fees (£2000 seem to be last minute tax returns) what does the £1000 fee look like is that 2/3 sole traders.
If you have been marketing your behind off and only got a few clients you are doing it wrong.
Earlier posters state the obvious and say that the best clients are from referrals. Forget that, as you have no clients who is going to refer you, when you have clients it takes time for them to be confident in your ability and track record doing a decent job before they will recommend you. Don't expect any work from client referrals for your first 3 years.
People work in different ways and don't have the network they did 10 years ago to ask "which accountant you would use" People dont have relationships with bank managers etc now.
Google search is key, you need a half decent website and some PPC In early days I wasted money on this but then paid someone to set it up properly
When its running I can get 20 enquiries a month through website 1 in 3 are looking for cheap but filter them out at the call stage.
Also build links with others that support business on your high street Insurance Broker, IFA's, Lawyers ect they are fishing in the same pond as you for work so cross refer to them and it will lead to professional qualified leads.
Also don't be afraid to take on work which is less than you would like. You need fees so working £20 per hour is better than nothing. If you sign up start ups on lowish fees they naturally increase when they buy extra services when they take on staff become VAT registered etc.
Networking should also produce leads if you put the effort in. Go to chamber and FSB events etc they should all produce contacts.
Have you thought of running an event where you invite 30 people along to talk about MTD or whatever.
Also give everyone you meet a business card.
If you are not a fan of social media get someone to do it for you.
In first year or so I though about giving in more than once but padded the money out with part time FD/FC roles to pay the bills.
Budget is set at £15 per day, typically spend between £250 £350 per month + £100 to guy who manages it for me.
I think the target ROI is supposed to be 5 to 6 times the spend on Google adwords, I am performing above that which would seem to be about right, and remember our work is recurring.
Its good to pick up small compliance based jobs