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Why practices should charge no-show clients

As a practitioner, every minute counts and nobody wants time wasted. So what do you do when a client does not turn up for a meeting? Zoe Whitman argues that these clients should incur a fee.

10th Feb 2020
Founder But the Books
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I read the recent post in Any Answers about non appearance fees with interest. During busy season, several clients hadn’t shown up for out of hour’s appointments, and the poster was considering charging a £20 non-appearance fee as a deposit. This would be deducted from the client’s bill, or lost if the client didn’t turn up.

The majority of responses either recommended implementing an email or text reminding service or stop offering evening and weekend meetings because of the high incidence of no-shows. And as Della Hudson pointed out, “If they did turn up they were only the tiny fees but proved to be the most hassle.”

Now, we don’t offer out of hours appointments unless there’s a real exception – such as finding out your brother in law hasn’t filed his tax return last thing on the evening of 31st January, for example. But we have suffered some very last minute cancellations recently for office hour’s appointments.

I have a lot of startups and small business owner parents in my network. Their businesses aren’t big enough for them to feel they can justify outsourcing their bookkeeping, but they do often need support with getting started, for example with setting up Xero.

We obviously want to help these clients so we offer 1-1 sessions where they can just sit down with us and ask us everything that’s on their minds. It’s a great service, it builds goodwill, those clients finally feel organised and able to tackle their finances, they recommend us to other businesses in their networks, and they come back to us later when things have taken off and they need more support.

Depending on the length of the 1-1 we charge up to £150 for this service. We know we add a huge amount of value in these sessions, but for a kitchen table startup it can feel like a lot of money. And I have found that people email at the last minute to rearrange – often rearranging several times, or they cancel at the last minute. It’s frustrating. We book time out for that specific client.

Of course, there’s other work I can be doing, but the ability to charge for that time has gone. Not to mention that inevitably I can’t rearrange for next week as they request, because my diary’s booking out six weeks ahead most of the time.

Is it reasonable to charge a deposit?

So the poster in Any Answers has decided to invoice a £20 deposit. It’s great idea if you don’t mind the admin, and we’ve started to take deposits as well. So far we’ve invoiced these with the client paying the balance by card at the meeting.

Personally, though, I think a really great way to do things would be for clients to book and pay directly through our website. I already have the ability for clients to book their own appointments in my diary, getting them to make payment at that point, would just be one extra step.

Would a deposit stop no-shows?

For the clients I’ve tried this with, the client has paid the deposit without question and has shown up for our appointment, so I’d say so far it’s been a success. But there is research that shows that a fine can actually encourage more of the “undesired behaviour”.

Now bear with me as I go off on a bit of a tangent but when I read the non-appearance fee post in Any Answers I immediately thought back to a study that had been conducted in Israel.

Some economists wanted to see how parents would respond to a fine for picking their children up late from nursery. If you’ve read Freakonomics you might have already come across it but in a nutshell: the nursery was finding parents were frequently late for pick-up and staff had to stay late to look after the children. They started to charge a $3 fine per child each time a parent was late.

The study found that rather than the late fine deterring parents from picking their kids up late, the number of late pick-ups doubled. The economists concluded that rather than seeing the fine as a penalty, parents saw it as permission to be late. And I think this is really interesting.

I wonder whether implementing a no-show charge will actually result in more cancellations and then that begs the question: “is the deposit enough?”

So how much should you charge?

If the client does cancel at the last minute, will £20 be enough to compensate for your time, the prep work you’ve done, and travelling to the office to make yourself available for that appointment? I’d argue probably not, and we’ve been invoicing 50% upfront without too much resistance.

Of course, we need to explain what that charge is for and why there’s a need to charge it, but it’s working for us and it’s something we’ll continue doing.

 

Replies (23)

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By Justin Bryant
10th Feb 2020 16:29

This only makes sense if you aren't working at full capacity, since otherwise you will be (mostly) double charging effectively.

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Jennifer Adams
By Jennifer Adams
10th Feb 2020 17:55

Call me an ogre but none of my clients would dare not turn up for our meetings as they know that their lives would not be worth living!

For the first year in ages this Jan season one client didnt turn up and she rang about 1/2 hour later to say sorry - she had forgotten.

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By SXGuy
10th Feb 2020 18:11

I couldn't charge a deposit, that's just not practical for me.

As for a fee for missed apointments that's a tricky one also.

Maybe charge it to repeat offenders, but to the client who rarely does it you could potentionally risk p'ing them off and losing fees. All for the sake of £20.

A better option in my opinion is a reminder service, which is easily done these days for next to nothing. (I use bulk sms).

If the client is still a no show or doesn't at least call to confirm they can't make it, at least you can justify charging for a missed appointment. In other words having forgot can't be used as an excuse for failing to tell you.

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By Tickers
10th Feb 2020 21:46

Accountants should stop doing work for free as a general rule. The F you pay me scene in Goodfellas comes to mind.

Seriously, what other profession pimps themselves out to such a degree as accountants? This fear of "losing the fee" and the "recurring income" mantra of accountants is their own undoing. Bill what you are worth!

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By justsotax
11th Feb 2020 09:19

To be honest if its happening that frequently I would take some work with you so you can be productive if they cancel.

I would add that if you get that many cancellations then one wonders what importance the prospect/client thinks of your offerings.

Finally, I presume that if you have to cancel the meeting then you would be required to compensate the prospect/client for wasting their time....?

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By NH
11th Feb 2020 10:11

stupid idea, if it is happening a lot the problem is with you not the clients, I cannot remember the last time I had a no show, unless there was a good reason for it there would not be a future show nevermind a no show.

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Replying to NH:
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By rich brewin
11th Feb 2020 10:35

Why is it a 'stupid idea' if it fixes the problem in this case. Just because the writer takes a different approach to you doesn't make it a 'stupid idea'.

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By Charlie Carne
11th Feb 2020 10:21

If they are visiting your office, why does it matter if they don't show up? You can just carry on with your work, happy in the knowledge that you now have an additional hour in which to catch up on all those unfinished tasks! If you went to the client's location and they forgot to turn up, that would be a different matter, as you would have wasted time.

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Replying to charliecarne:
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By Justin Bryant
11th Feb 2020 11:22

That is precisely my point above - and incidentally it makes we wonder why doctors complain about this as my appointments are always delayed by around 15 mins regardless of all these no-shows (so if they showed up the delay would presumably be even longer).

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By rich brewin
11th Feb 2020 10:30

Nice article Zoe. Getting clients to book upfront and pay online for 'product style' slots such as training, basic returns, etc is nothing more than using current technology and bringing us into line with the rest of the commercial world so I see no reason for client objection. You could take a leaf out of the hotel sector book and offer a dual price - a higher price for a meeting that can be cancelled up to 24 hours in advance and a lower price for a non-cancellable one.

We have to educate clients on the value of our time...and theirs! The time and resources of good accountants and firms is a commodity in demand.

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By mkowl
11th Feb 2020 11:05

We used to have a client where the day before the office joke would be "what time is he cancelling tomorrow" as opposed to what was the time of the meeting.

Saying that the worse scenario is a client turning up for a meeting and you have forgotten all about it - never happened here of course splutter

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By Cardigan
11th Feb 2020 11:13

We have had the occasional prospect not turn up. I think it is mainly just a case of they found someone else in the meantime. We use an automatic reminder service and sometimes, if I get a feeling someone will cancel, my PA will call or text them to confirm the time. A text works better as it allows the prospect to save face if they have gone somewhere else.

We have never had a client not show up as far as I recall. We send the automatic reminders to them too. Sometimes if a client can't show up in person because of a last minute issue (sick child etc), we offer a phone call instead at the same time.

The main thing is, we give clients no excuse to forget that the appointment was today.

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By Michael B Bennett
11th Feb 2020 11:19

If the meeting is at your own office, then why charge? You can still do billable work while you wait.

In my view, it is this "charge for every second" approach that gives accountants a bad name.

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By Michael B Bennett
11th Feb 2020 11:19

If the meeting is at your own office, then why charge? You can still do billable work while you wait.

In my view, it is this "charge for every second" approach that gives accountants a bad name.

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By Laurence Vogel
11th Feb 2020 12:30

This is an interesting article with interesting comments. As a supplier to accountancy firms for 12 years I have encountered cancelled meetings a number of times. Some are first initial presentation /creds meetings and others 'sign up' meetings. We confirm each meeting at the time it is scheduled and reconfirm the week before. The partner at the practice has our contact details and each time it happens we have turned up and found the partner out of the office as they have forgotten about the meeting.

Sometimes the meeting was never put in the diary, other times something cropped up like an urgent client meeting or something personal.

Would readers of this post think it unreasonable if I, as a supplier, charged a cancellation fee? My time is finite and expensive. Not only is it the meeting time I have lost but also the travel time and associated costs. That meeting I scheduled for 4 weeks time as my diary was busy could have then been attended sooner.

Most accountants who need to reschedule do so in advance but there are some accountants who think our time is not important. A few months ago I had a new business meeting with a practice in Barry, Wales. The meeting was reconfirmed the week before and I booked my train tickets. On route, out from London, I had to change trains in Cardiff. I rang 30 mins before the meeting, whilst waiting for the connection in Cardiff to let the firm know I was on my way and running to time. I was met with the response - "xxxx is unable to meet you. He has had an urgent meeting to attend.". Furious, I left Cardiff station and got a coffee. I composed an email to the partner in question and explained where I had come from and whether they would like to reimburse me for my train ticket, not even my time. The response was immediate, and it was a No and that I should expect things like this to happen. Suffice to say, with that attitude I did not bother rescheduling that meeting. Whilst I can work anywhere it was a wasted day with hard costs incurred.

On another note, for accountants meeting suppliers, would cancelling a supplier meeting be less likely if the supplier was paying for the accountant's time, in the same way a client would?

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Replying to Laurence Vogel:
By Glenn Martin
11th Feb 2020 16:55

I think you would find the number of meetings you got reduced a lot if you charged a fee if you as a supplier charged a fee for a cancelled meeting to sell me something.

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Replying to Glennzy:
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By Laurence Vogel
11th Feb 2020 23:58

Are you saying that it is acceptable for people to not bother showing up for meetings with suppliers and that suppliers time is not important?

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By Mr J Andrews
11th Feb 2020 15:49

Surely it's a case of knowing your clients - and your clients knowing you.
My clients know that I will not tolerate any such ignorance. They never fail to turn up unless there is good reason such as illness or injury. I would much prefer an abortive meeting rather than a client sharing a client's cold germs . I expect this common sense to be reciprocal.
If I suggested charging a deposit for an unlikely cancelled appointment, I fear certain clients would smell a money grabbing scheme . But if I were to do so , I would expect clients to have the same recourse to such a dumb [***] idea.
As for the tangent , or analogy to picking up kids late from the nursery , this just shows the absurdity of the article. The parents haven't FAILED to turn up . They've simply turned up LATE and an additional charge is appropriate.
If the writer can't see the subtle difference, then God help her.
Get a life.

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By Andy Reeves
11th Feb 2020 17:01

I never take out of hours appointments. I just don't need the aggro. If the client values the accountant enough, he will make time to come along in office hours.

As regards cancellations, everyone gets one chance, and no more. One no-show is (just about) OK, but a second one and they need not bother to contact me again as I would refuse to see them.

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By alialdabawi
11th Feb 2020 18:12

Do clients still want in-person meetings nowadays?

100% of my clients communicate with me by phone/email and share information electronically.

I haven't physically met some clients for 2/3+ years now. Documents for MLR move within postal systems and 1-on-1 training with bookkeeping on virtual screen sharing &/or remote access & telephone/VoIP conversations are the only scenarios where coordination is required.

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Pile of Stones
By Beach Accountancy
11th Feb 2020 21:32

Does nobody realise clients have a choice? If I charged for a missed meeting:

1) The invoice wouldn't be paid
2) I'd have an ex-client - I'm sure one of the other 30 firms of accountants in my town would be pleased to accommodate them

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Sparkly Orange
By Sparkly
12th Feb 2020 21:13

How long does it take to explain the charge? How long does it take to prepare and issue the invoice? How long does it take in additional credit control admin? I'm not that desperate for £20! I treat my clients like the busy human beings that they are, occasionally they mess up and forget appointments. It is rare though and if someone does then I contact them afterwards in a nice way and invite them to rearrange.

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By AndrewV12
13th Feb 2020 11:23

Regrettably, in a funny old way its good to see others being messed around like I am, (its not just me.)

It always makes me think that those accountants who charge a pittance. must go mad when a client does not turn up, there is no margin for error or problems with such low fees, there is no slack in the fee to cover such events.

It also makes me think what do low fee accountants say when clients call in requesting advise, there is no wiggle room in their fees, do they say the first thing that comes into their heads. Looking into any query with a technical angle must be totally out.

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