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Are you conning your clients?

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1st Dec 2014
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Your instinctive reply to the question posed in the title of this piece is probably “of course not”, says Mark Lee.

Indeed I’m quite sure that you, dear reader, are not conning your clients. Not knowingly at least. Anyone likely to do so is unlikely to be reading AccountingWEB. So why did I pose the question?

My inspiration was the musical comedy ‘Dirty Rotten Scoundrels,’ that I saw recently at the Savoy Theatre in London. The original film version in 1988 starred Michael Caine and Steve Martin. I don’t want to spoil the story for anyone yet to see the show. Suffice it to say that it revolves around two con-arts who compete to out-do each other, conning wealthy guests at a hotel on the French Riviera, who seem only too keen to part with their money.

I was hoping to see Robert Lindsay on stage in the lead, supported by Rufus Hound. Sadly the latter left the cast a few weeks ago and Lindsay was off sick. His part was very well played by his stand-in, Darren Bennett. The female lead was also played by an understudy – again, it wasn’t obvious. So, to be clear, I didn’t feel conned and I loved the show – despite never having seen the film or knowing the storyline.

The cons in the show are in stark contrast to the long-con approach adopted by the team in the TV series Hustle (which starred Adrian Lester and ran from 2004-2012). The Hustle crew only conned ‘bad’ people who ‘deserved it’.  One lesson I recall being stressed throughout all eight series was that ‘You can’t con an honest person’.

What has all this to do with accountants in practice? Bear with me and I’ll explain some related thoughts.

Business advice

Thousands of accountants claim to be ‘accountants and business advisers’. To my mind this obligates them to offer business advice rather than simply to focus on the annual compliance work. Of course there will be those clients who resist the idea of paying more than a basic fee and who therefore exclude themselves from benefitting from business advice. Equally there are, it seems, some accountants who rarely offer business advice – despite the implied promise of their nomenclature.

Specialist areas

This is one of those marketing ploys that seems to be widely misunderstood. For example, none of us can really specialise in ‘SME clients’. The definition of SME covers over 99.9% of all UK businesses. Saying “I specialise in SMEs” carries little more meaning than saying “I specialise in working for any business, big or small, that is not in the FTSE 350”. By definition that’s not a specialisation.

The encouragement to identify our specialist clients comes from marketing advisers. They want us to make it easier for other people to refer new clients to us. This is easier if they can remember us as being distinct from the other accountants out there. One way to do this is to highlight your expertise in dealing with a particular type of client. This then becomes your specialist area. And it works. But we’re concerned that if we reference a specialism we might alienate those of our clients who don’t fit that specialism. And we may be rejecting those prospects who don’t fit the client profile of our specialist area.

As a result you will see many accountants’ websites claim they have specialisms in what seems to be all the areas in which their varied client base operates. Again, that’s not what it means to ‘specialise’. 

Limited experience

What do you when you realise that a client, or even a prospective client, needs advice on an issue about which you have little or no real knowledge and experience? I know plenty of accountants who have the self confidence to, quite rightly, admit when this is the case. They then either encourage the client to seek specialist advice or they obtain this on behalf of the client.

Guessing what to do or failing to give appropriate advice due to inexperience or naivety is a risky game to play. Not only can the client lose out but there is also the prospect of a negligence claim or of disciplinary action when you’re found out.

Excessive fees

I can recall plenty of occasions when readers of AccountingWEB have criticised those who charge high fees for the provision of high value advice – such as when huge tax savings are forecast as a result of incorporating a sole trader business. In principle I see no problem in charging value based fees if the clients willingly agree to this up front. But do they always have full knowledge of what other accountants would charge to do the same work?

We know how hard it is to obtain directly comparable fee quotes for what may, or may not, be the same service to be provided by different accountants. There are some accountants who simply charge an hourly rate regardless of the value of their advice to a client. Others believe that some accountants are charging too much or too little for the work and advice they offer.

We could say that it matters not as long as the client is happy. Is that always true actually?

Keeping the taxman at bay

One of the services that clients implicitly require from their accountant is to ensure that they remain fully compliant so as to reduce the prospect of being investigated by HMRC. I have heard anecdotal stories of accountants who assure new clients that HMRC will not be a problem because of the accountant’s positive reputation. This may have been the case many years ago when local tax offices knew local accountants. I don’t believe it has been that way for some time so why do some accountants suggest that nothing has changed?

Greedy clients

It would be easy to side-track here into a discussion about how greedy clients have only themselves to blame if they ‘invest’ in fancy tax avoidance schemes that eventually unwind.

I think we all know however that there have long been plenty of scheme promoters who seek to exploit that greed by over-promising the likely effect of certain tax schemes. Some accountants who got caught up in such situations naively repeated these promises despite not fully understanding the risks, downsides and likely challenges that would ensue.

Conclusion

Some accountants may unintentionally and naively over-promise the possibility of a positive outcome from clients’ activities or from HMRC’s enquiries. However, I believe that few accountants would knowingly attempt to con their clients. Unless you know better…

Related reading:

Mark Lee is consultant practice editor of AccountingWEB. He has created a seven step framework to help accountants who want to STAND OUT from the pack; he facilitates The Inner Circle group for accountantsmentors accountants, entertains as a conference speaker and is chairman of the Tax Advice Network of independent tax specialists who provide support to smaller practices.

Replies (259)

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Replying to memyself-eye:
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By qad999
13th Dec 2014 14:17

never antagonise your target audience

isn't that the first law of selling ?.. it should be

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By Bob Harper
13th Dec 2014 15:07

Good idea

@qad999 - I love it when traditional accountants call me a dangerous idiot...it means I'm doing something right.

If you were serious about exploring this issue you'd talk to Damion and get the full picture...like I said, accounts don't tell the story. For now just read the case study (so far) click here.

In terms of conning people...the sad truth is that traditional accountants are conning themselves that what they do has value.

Bob Harper

Crunchers

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Replying to SXGuy:
Locutus of Borg
By Locutus
13th Dec 2014 18:34

Oh dear, Bob

Bob Harper wrote:

@qad999 - I love it when traditional accountants call me a dangerous idiot...it means I'm doing something right.

If you were serious about exploring this issue you'd talk to Damion and get the full picture...like I said, accounts don't tell the story. For now just read the case study (so far) click here.

In terms of conning people...the sad truth is that traditional accountants are conning themselves that what they do has value.

Bob Harper

Crunchers

I had a look at the link to the "Damion" case study (by the way, lots of typos). Oh dear, Bob - it just reads like you've talked some naive young man (who by his own admission had only a few months accounting experience in an office) into paying you four grand for sales training and telemarketing. I'm sure the real cost of buying into your franchise, when you add everything up, is actually much more than £4,000.

The poor guy did a crash course at AAT, but can presumably never be admitted as a member, as he has no one supervising his work. When I did AAT in the early 1990s, it took about 2 years and I had the benefit of gaining real world experience in the firm I was working in. Training and qualifications are useful, but you can't beat experience. I had about 10 years working for others in general practice before I set up on my own.

Sure, he has a few clients (probably mostly bookkeeping and startup cases) after paying for telemarketing, but the question will be what happens when some of these clients ask questions about areas he has never covered ... or he starts giving wrong advice on something because he simply doesn't have the experience to know otherwise.

The case study says the business is after 18 months estimated to be worth £50,000, but you only have to have watched Dragons Den to know that can mean anything.

What I am most puzzled by is that this guy seems to largely be doing COMPLIANCE work (if you look on 4networking.biz), with NO mention of value pricing or this New World Order of the Accountancy Profession that you prophecise is coming.

I'm not knocking the guy, given that he had very few options if he couldn't / wouldn't spend years being employed in practice like most of the rest of us did, but I hardly see people like this taking over the accountancy profession.

Any other case studies, Bob?

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Man of Kent
By Kent accountant
13th Dec 2014 19:05

Who's conning who?

@Bob - what are you trying to achieve by posting on here?

You seem to delight in winding people up.

Given that accountants, especially small practitioners are (one of) the target market(s) for your 'More Network' it doesn't make commercial sense.

And before you say we're not your target market, WE ARE. I've had two phone calls from Alex and he has left two voicemail messages all in the last 3 months.

So on one hand you're clearly after our business and on the other you rubbish what we're doing in a dismissive and condescending manner as though we don't know how to run our practices (btw my practice was worth an awful lot more than Damion's - after the same time period).

Where's the commercial sense in that?!

You're just conning yourself and your business partners.

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By qad999
13th Dec 2014 22:42

balance sheet says it all

Bob , I've read the story (elementary grammatical errors and all.. Ps the most important thing in business is the end product .. so try proof-reading in future before you publish ) .

You've tried to rubbish Damion's balance sheet .. yet say the business is worth £50k ?.. you give away too much .. the balance sheet at cost is worth nothing (- £3k) .. so the 50k must be goodwill/fee base  , with fees selling at 1  x  GRF, that is approx £50k of fees pa , less say £10k overhead for a  one man bad , leaves the £40k pbt I guesstimated  from the balance sheet creditors of £8k (which are probably mainly CT)

I find it incredible you rubbish a " statement of worth"  prepared in accordance with  the Companies Act ( that is to show a  true and fair view) . perhaps you should read it someday soon

 

One thing is for sure , you are condescending (and still an idiot with it) , making statements that accountants  do not give value . You do not know our business or what we do , so don't pretend to

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By qad999
13th Dec 2014 22:30

Locutus says it all Bob

Bob, Just look how long he took to train and gain experience before he felt able to set up in business .. and then look at your case study .. there is absolutely no comparison.. in fact your sales patter is nothing more than the old "get rich quick" model , but you fail in one important respect , and that is...."knowing your customers business"

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By qad999
13th Dec 2014 22:38

"We GiveTechnical support on things like Prior Year Adjustments"

Why so prominent in the case study Bob ? ... do you make lots of Big Mistakes ?.. because in practice these are fairly rare .. maybe it' s your  "Big Data" 's fault .. making "Big Mistakes "?

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By qad999
13th Dec 2014 22:58

"Bob Harper's Magic Vacuum Cleaner"

Before Bob and timeshare , a long long time ago , door to door vacuum salesmen were every housewives dread.. they would cold-call , turn up at the door, put their foot in it and then "talk the talk"... espousing the new magic "cleaner than clean" sparkling vacuum that removes any dirt . They would worm their way into the house and then suddenly throw a small bag of black soot onto the carpet and proceed to hoover it up  in order to show how good the machine was.. yes you've guessed the end of  the story already .. housewives were invariably  left with a grey smear on their carpets that they found impossible to remove

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By Bob Harper
14th Dec 2014 09:03

Target market

@Kent - we can't find/buy a database of accountants with passion and open mind so we are calling lots of firms. It was just a test campaign nut trust me, you are not our target market. 

@Loctus - keep a track of Damion and see how the story develops. He (and we) have just started.

@quad999 - I know it hurts but statutory accounts show very little about how a business is developing. And, are very little use to improving the business.

Bob Harper

Crunchers

 

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Replying to lionofludesch:
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By qad999
14th Dec 2014 23:21

it shows what happened and is a snapshot

Bob Harper wrote:

@Kent - we can't find/buy a database of accountants with passion and open mind so we are calling lots of firms. It was just a test campaign nut trust me, you are not our target market. 

@Loctus - keep a track of Damion and see how the story develops. He (and we) have just started.

@quad999 - I know it hurts but statutory accounts show very little about how a business is developing. And, are very little use to improving the business.

Bob Harper

Cruncher

Your utterances are incredible and defy logic.... the balance sheets are very useful , it shows us what has happened from year to year to the asset base and gives us a snapshot of its net worth ( at historic cost) at the end of year 3 , added with  the other info you gave away ( which we could have guesstimated anyway)  ... we have all  we need to know.. yes its a little puzzle with abbreviated accounts but accountants are good at that

so what is the timescale in the business plan ? you are already into the dangerous territory of the long run, my guess is you will keep extending the "incubation period" .. you need to know when to bail out and 3 years is it for most investors 

You say you expect your firms to have MINIMUM  turnover of £150k in 3 to 5 years , but your pilot office is way behind and unlikely to gain another GRF of £100k pa in the next 2 years ,( unless of course he merges or buys a block) so its clearly all sales spin

Ps I cant find ownership details of  the LLP on your www as required by law, may have missed it though  ( as you will know.. and as a firm giving technical advice you should know.. there is a fine). If so I think I just added some value .. if so just give it to charity

               

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Man of Kent
By Kent accountant
14th Dec 2014 15:17

Passion and an open mind
You mean someone gullible enough to pay the £300 you want for a telephone conversation which you describe as 'the best telephone conversation you'll ever have".

I know who's conning who.

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By Bob Harper
15th Dec 2014 09:15

£300 conversation

@Kent - I have no idea what you mean about a £300 telephone conversation.

I do charge for telephone sessions but only if a) agreed in advance b) I know I can help with a specific issue and c) I believe the client will benefit.

I've read through a few your blog posts and I know I could help you avoid "drowning by numbers". But, it seems you've chosen to rope your wife and her sister to do some work for you.

@Qad - Damion doesn't need to win another £100k to get to £150k.

A balance sheet won't tell you:

How much he has learnedHow much his skills have come onHow much his mindset has come onClients he has turned awayReferral rateReputation in the local marketValue to his clientsHow much fun he is having

These issues are much more important (in terms of Damion's future success) compared to last year's Balance Sheet.

This is where we focus with Damion..I know the balance sheet will take care of itself. And, I'd suggest accountants do the same.

Bob Harper

Crunchers

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Replying to GW:
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By qad999
15th Dec 2014 18:17

bad valuation

Bob Harper wrote:

@Qad - Damion doesn't need to win another £100k to get to £150k.

A balance sheet won't tell you:

How much he has learnedHow much his skills have come onHow much his mindset has come onClients he has turned awayReferral rateReputation in the local marketValue to his clientsHow much fun he is having

These issues are much more important (in terms of Damion's future success) compared to last year's Balance Sheet.

This is where we focus with Damion..I know the balance sheet will take care of itself. And, I'd suggest accountants do the same.

Bob Harper

Crunchers

If he doesn't need another £100k to reach £150k , you've badly under-valued the worth  of his business at £50k , just using a simple 1 x multiple of GRF, of course you are going  to say that because we do not have access to the records. You can make all sorts of claims , but no-one believes you , and rightly so, because it would work through to the balance sheet , which you continually dismiss

Some of the other "bullet-points" would have an impact and produce a healthy balance sheet, which we certainly do not have here 

as for having " fun ''  !.... ?..I think most would substitute "rewarding" ., however to be fair  I can easily visualise you having fun in a  clown suit  complete with red nose and joke flower on lapel that's squirts water

                  

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By johnjenkins
15th Dec 2014 09:48

@Bob

I would love for you to start your own Accountancy business. You would need your own slot in "Any Answers" though.

As I have said before Bob, you really don't know what Accountancy is all about. That's because you're a salesman and by definition you are not really interested in the cogs as long as someone buys (being passionate about your product isn't enough). I actually feel sorry for Damion, however should he contact me I will put him on the correct path.

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By johnjenkins
15th Dec 2014 09:51

@Mark

4 pages and no end in sight. Come on you must have something to say, even if it's "I'm too bored to post".

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By Bob Harper
15th Dec 2014 10:09

Path

@John - once again your comment on a "salesman" shows your "dumb expert" attitude. I will be releasing a training video on mindsets and this is one I urge "experts" to think about carefully.

You do have a lot to say so why not give Damion a call...here are his contact details click here. Go on, you may even learn something, although I doubt you are brave enough.

As regards me...watch this space and if I need any technical support (which I probably will) I would prefer to pay for it because it helps build a knowledge base for the future and de-risks the venture.

Let me know how you get on with Damion.

Bob Harper

Crunchers

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By johnjenkins
15th Dec 2014 11:18

@Bob

I'd rather be a "dumb expert" than a "blinkered salesman" any day of the week.

Why on earth would I want to contact Damion. My offer was that if he posts then I would steer him on the right path. Perhaps he hasn't got the bottle to post on behalf of being your protege.

A training video on mindsets by a salesman says it all. Come back John Cleese - please.

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By Bob Harper
15th Dec 2014 11:46

@John - I know you'd rather be a dumb expert...where you in a big firm by any chance?

Bob Harper

Crunchers

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By ireallyshouldknowthisbut
15th Dec 2014 12:41

.

Hang on Bob, didnt you say earlier when I suggested "Crunchers" had the wrong brand as it sounded like a bookkeeping "number crunching" business, that I was wrong and it was all about added value and some other nonsense?

And lo.........it turns out your typo ridden case study is working absolutely in this area.  Ie the nasty low margin highly competitive world of bookkeeping and "chuck the number on the tax return and hope for the best" market. 

That is quite genuinely a nasty place to me. It is competitive, and low priced as there are lots of numpties about who will 'have a go at tax' for a small fee and know very little about what they are doing.  Like your franchisees for example. 

Could it be that this is what you think accountants do?

If so that really is quite funny for an "expert" such as yourself who think he knows better.

There is a whole different business model out there based on skill and knowledge. An alien concept I know, but its out there and what is more - it works. And its quite easy to differentiate yourself from the "unskilled form fillers" like your franchise model and also from the sausage machine outfits. 

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By Bob Harper
15th Dec 2014 13:24

Models

@YouReallyShouldn't - yes, compliance is included (because we are accountants) but it is the basis of our relationships, not the reason for them. 

At Crunchers, every client has business advice included as standard. This is a mixture of some 1-2-1 work, seminars/workshops and soon to be released videos and software. 

With the videos and software I think we are moving towards a position where every client will have a documented business plan and budgets which they review to actuals on a monthly or quarterly basis.

It could well be we end up not charging for the compliance so we are not really fussed about the price or margins on this work. A bit like a loss leader, if you like.

Bob Harper

Crunchers

 

 

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By johnjenkins
15th Dec 2014 14:08

You said it

Bob. A lost leader (oops sorry typo).

What makes you ask if I was in a big firm? The training in the sixties was the same in most firms. I doubt very much if our basic training has changed that much and there is good reason for that Bob. Where did you train?

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By Dan Izzard
15th Dec 2014 14:09

Please avoid...

Personal insults, inverted commas or not. Further comments may be edited in accordance with the community rules.

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By Bob Harper
15th Dec 2014 14:48

Dan

@John - your attitude towards sales/marketing is VERY outdated and many of the bigger/larger firms seemed specialised in installing certain mindsets and attitudes.

I won't use names to suggest what these are otherwise Dan will have to start editing the conversation. I just wondered if you were are a product of a large firm.

Bob Harper

Crunchers

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By ireallyshouldknowthisbut
15th Dec 2014 15:13

Bob if as you say your number crunching franchise is not about number crunching and yet that seems to be exactly what you do. Compliance work. At £90 a month. Which with a £40,000 turnover (annual reader, annual, not weekly, not monthly, annual) you have er about 40 clients.

Thats not even one a week!

Sounds like a part time hobby business to me unless you are doing an awful lot of bookkeeping. Compliance work for a small bix should be 1-2 days max unless again, you dont know what you are doing. 

Also I wouldn't put this on your website "We can guarantee that our tax advice will save you as much as is legally possible. "

 

If you knew a bit about tax - I appreciate you are mainly a sales guy and no nothing at all about tax - you would realise why that was an impossible claim to make, not least with the pitiful tax resources you have at your disposal (one inexperienced bookkeeper, no senior, no tax department, not partner, nothing!)

I wouldn't put my families finances at risk with such a claim. 

 

 

 

 

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By Bob Harper
15th Dec 2014 15:28

Number crunching

@YouReallyShouldn't - we are all about number crunching, just not only the traditional numbers that you deal with.

I think we will change some statements in the New Year because we will NOT do everything that is legally possible - we don't think everything that can be done is morally acceptable.

There are many ways to get great tax technical support, you do not need a department. Even if we have 350 office offices I doubt I'd put a tax desk together to support the offices.

Bob Harper

Crunchers

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Replying to paul.benny:
By ireallyshouldknowthisbut
15th Dec 2014 18:15

this is what proper accountants do

Bob Harper wrote:

 

There are many ways to get great tax technical support, you do not need a department. Even if we have 350 office offices I doubt I'd put a tax desk together to support the offices.

 

You could employ a competent professional accountant to run the business for one.  Might be a start.

A "helpline" number is not proper support for low grade staff. I wouldn't trust my assistant (who I should say is a lot more experienced and qualified than your main man) to pick up on the real issues, that is to say even know when to ask for help. 

 

 

 

 

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Replying to paul.benny:
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By qad999
15th Dec 2014 18:49

never 350

Bob Harper wrote:

@YouReallyShouldn't - we are all about number crunching, just not only the traditional numbers that you deal with.

I think we will change some statements in the New Year because we will NOT do everything that is legally possible - we don't think everything that can be done is morally acceptable.

There are many ways to get great tax technical support, you do not need a department. Even if we have 350 office offices I doubt I'd put a tax desk together to support the offices.

Bob Harper

Crunchers

but you don't have 350 offices anyway  Bob , and there's little chance of it happening...you only seem to have 6 , counting your own . and the offices are people who have bought a franchise, they are not really your offices.. are they ?

       

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By johnjenkins
15th Dec 2014 16:04

@Dan

For the avoidance of any confusion all my posts are towards the posters posts and not towards the poster. Any posts made by the poster towards my posts are not considered posts towards me personally. If, however the poster intended to make posts towards me rather than my post then my posts would reflect the posters posts and be posted accordingly.

@Bob. No Bob, my attitude towards sales/marketing is spot on. It is sales/marketing and their techniques that have not only lost their way but totally outdated. (That's why your business is flat lining). This has been highlighted by the banks having to find millions for miss-selling.

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By Bob Harper
15th Dec 2014 20:14

Time

@Qad999 - I agree, the results will be shown in the accounts in due course. Keep tracking, you'll get a history lesson like most accountants give their clients. 

As I've said before, we've really only have one office. But, we may only need one office!

@John - our business has been in innovation and development mode, working with Damion. We start to promote in 2015.

@YouReallyShouldn't - what specifically are "real issues" for tax with start-ups and small businesses. I think you over-play the complexity.

Bob Harper

Crunchers

 

 

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Replying to Sandnickel:
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By qad999
15th Dec 2014 22:47

no real issues for tax ?

Bob Harper wrote:

@Qad999 - I agree, the results will be shown in the accounts in due course. Keep tracking, you'll get a history lesson like most accountants give their clients. 

As I've said before, we've really only have one office. But, we may only need one office!

@John - our business has been in innovation and development mode, working with Damion. We start to promote in 2015.

@YouReallyShouldn't - what specifically are "real issues" for tax with start-ups and small businesses. I think you over-play the complexity.

Bob Harper

Crunchers

Answer .. you'll find out after you've left a few time bombs ... and with that ....."welcome to the arena" ..

Ive just looked at  your pricing .. it is very expensive for what you provide, so I dont think you have any  competitive advantage ,and  I dont think clients will value regular webinairs , a few phone calls , etc  after a while ....particularly when the novelty wears off ,but the standing order goes on
but anyway .. its a free country

       

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Replying to Sandnickel:
By ireallyshouldknowthisbut
16th Dec 2014 18:12

All real issues and they are complex

Bob Harper wrote:

 

@YouReallyShouldn't - what specifically are "real issues" for tax with start-ups and small businesses. I think you over-play the complexity.

Bob Harper

Crunchers

 

Well this is an "it depends" type question. It depends who the start up is, what they are doing, what industry they are in, where they are starting from and where they want to get to.

Advice for a start up is *much* harder than for an established business as there are so many more thing they need to think about as there are no norms.  You have big issues about structure, growth, location, pricing, cash flow, staffing, you name it, you will have it.  You have issues about planning for growth, planning for failure and of which the client might - or might not - want to discuss with their accountant, and boy you better be ready to do so. 

Of course if you narrowly look at is as "watch my videos, I will add up the numbers you put in front of us" then clearly its 'easy' but you will have failed to do the one thing you advocate (quite correctly) that the business of accounting does not stop with the numbers but you need to be the agony uncle for a whole range of issue.  This where the calibre of your staff (or not) comes in, and why the traditional 'dying' (in your opinon) accountant model WORKS.  And will continue to work for the at least the next 20 years of my working life, although the 'tactics' may change, the tech may change the underlying relationship will not. 

And why when you employ bookkeeper level staff will know squat about any of the things I have mentioned above you will die on your backside and flounder around at low levels. You will need to get all your work from cold calling as you will get precious few referrals.  If your main man knows little it will be hard to convert leads too and you will really struggle, instead of, as you would expect after 3 or 4 years to be working at near or full capacity, and then be in a position to pick and chose clients and boost margins and turn the business from "busy" to a "money making machine"

Of course I only do this for a day job, I am not a consultant. If I chucked in some buzz words and made up some stuff about the things I had "invented" would it help?

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Man of Kent
By Kent accountant
15th Dec 2014 20:34

As Ogden Nash put it

"Whenever you're wrong, admit it; whenever you're right, shut up."

Keep going Bob...

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By Bob Harper
16th Dec 2014 09:14

Price

@Qad999 - expensive compared to who? You or other accountants who focus on compliance? We will always be more expensive because we offer more.

Our main competitive advantage is based on ongoing research, development and innovation. We can afford to invest non-chargeable time. Yes, we share the knowledge in events but from 2015 we are moving to a video knowledge base and courses. This allows clients to access high quality, practical business advice 24-7 from their mobile.

Will it work? I don't know but we are willing to take the risk.

Bob Harper

Crunchers

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Replying to darkmatter:
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By qad999
16th Dec 2014 16:21

high quality advice...

Bob Harper wrote:

@Qad999 - expensive compared to who? You or other accountants who focus on compliance? We will always be more expensive because we offer more.

Our main competitive advantage is based on ongoing research, development and innovation. We can afford to invest non-chargeable time. Yes, we share the knowledge in events but from 2015 we are moving to a video knowledge base and courses. This allows clients to access high quality, practical business advice 24-7 from their mobile.

Will it work? I don't know but we are willing to take the risk.

Bob Harper

Crunchers

 

.. but presumably not any high quality practical advice as relates to trading disclosures ? .... because I could'nt find all the required bits on your www, eg co. number ..because ..... I think its an LLP ?

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By Supertorben
16th Dec 2014 09:49

Just lost another corporate client. The former client asked me to continue providing payroll services until the end of the tax year and would I put through a payment of £2k to his estranged wife, who, as company secretary, was advised by her legal team was an amount to which she was "entitled". She is not a director of the company , has done nothing to warrant any "remuneration"  and has other employment. The new accountant wants to get relief against corporation tax for this payment, which has already been made. Incidentally, the director's salary is £660 per month, he is the only employee, the balance sheet total in the latest completed accounts was £4,483 after a loss of £3,301 so we are talking really big numbers !

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By johnjenkins
16th Dec 2014 10:12

@Bob

So looks like you're following the Fairy advert. I really don't think you've grasped what working is all about.

You've got no chance with the big boys. They will have tax pros and business advisers.

You've got no chance with the one man bands, because they really can't be bothered with sales crap.

So we are left with medium companies. Theses will be split into two. The ones who want to be biggies. They will go for pros. The smaller ones who are happy with what they can control and will want an Accountant who they feel is professional and caring. I don't really know where you would fit in Bob.

If you want to get this off the ground my advice would be to make sure you have enough money to pay your bills for a year, then offer your services or whatever at next to nothing and target start ups only. Put a nice little package together that might tempt them. That way you're getting to them before they've had a chance to meet a real Accountant.

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By Bob Harper
16th Dec 2014 12:39

Advice

@John - I agree, most people will probably NOT go for what we are offering. But, strategy and marketing is about NOT going for most people.

We are gambling (after research) that there are enough people who want to try something different and will be comfortable with virtual advice. I think they will appreciate a firm doing more than what a traditional accountants and pay a premium for it.

Time will tell.

Bob Harper

Crunchers

 

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By justsotax
16th Dec 2014 12:52

I wonder what Mark's

view of this is.  Having suggested accountants were not doing what they say what is the view on inexperienced individuals giving 'proactive' and 'value added' advice on stuff they have little or no experience of....is that a conning the client?

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Locutus of Borg
By Locutus
16th Dec 2014 13:02

The revolution in the profession?

I think I understand what you are trying to do in your network.  It's called "bundling" you get a compliance job and then bundle other generic "added value" services into the package, such as cash flow, business plan, quarterly meeting. Some clients are prepared to pay a little extra for these service, although by looking at the "Damion" case study, not a great deal more - especially if you have a rather inexperienced person doing it.

Of course, if there really was little value in the compliance work, then your network members would simply outsource all of the boring compliance stuff to other accountants and just do the "added value" consultancy bit.  But that wouldn't work for your network members because they would lose the client.

The trouble for you, Bob, is that for those accountants that really believe in the whole value pricing thing, there is a much better network - Steve Pipe's AVN, which has at least 100 times the public profile of yours, and I think he has been doing it for around 10 years.

The whole concept isn't really that new.  Paul Dunn's Accountants' Bootcamp was doing something similar over 20 years ago.

Over the years, I have met both Steve and Paul and in spite of them both being extremely charismatic people, with a gift for selling, they have so far failed to fundamentally change the profession.

The reason why Accountants' Bootcamp, AVN and Crunchers will remain niche for the foreseeable future is that people take a long time to change - not so much the accountants, but their clients.

When the micro / small business market starts demanding these products (and is prepared to pay for them, perhaps on a value pricing model) then the accountants serving that market will change.

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By Bob Harper
16th Dec 2014 13:10

Change

@Locutus - AVN are great, I learned loads. The same for Paul.

However, I think there is demand for business advice right now, it's just no one has worked out (until now) how to deliver within a budget and make a profit. 

Bob Harper

Crunchers

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By AndrewV12
16th Dec 2014 14:56

This topic has touched a nerve

Right lets run through it.....

Extract above

'Some accountants may unintentionally and naively over-promise'

Any reasonable Accountant never does this, they know the boundaries and when they are getting out of their depth, its the crap end of the market that does this.

 

Business advice

i give advise on 20 years plus of experience, add to this I know the boundaries, there is no problem here for most accountants.

 

Specialist areas

I specialise in SME, its the only accounts i do, how would it not be a specialist area.

 

Limited experience

There are always areas of un-certainty, using experience skill and judgement these areas can be either cracked or navigated around.

 

Excessive fees

i wish

 

Keeping the tax man at bay

Two rules, always show a reasonable profit and get your clients to pay some tax, thats it

 

Greedy clients

yes there are some, a good accountant can get them to pay a reasonable amount of  tax.

 

 

 

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By johnjenkins
16th Dec 2014 20:15

The only thing I see

changing is that instead of self-assessment it will be HMRC tax bills with us to prove them wrong. Looks like we will have come full circle. It will take HMRC about 10-15 years to set up. It's what they've always wanted. Although we are not far off it anyway. All the major supermarkets know exactly how much we spend and what it goes on (yes even cash).  Cars, Insurance and MOT's are all on computer and traceable. So not much left to spend ill gotten gains on.

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By Bob Harper
16th Dec 2014 22:01

@qad999 - I never said I was perfect.

@John - I'd love to see the tax system radically change. 

@YouReallyShouldn't - the truth is that most start-ups can't afford the advice in the traditional way so they don't actually get it.

Our approach is to get 80%+ of what they to them via video and then consult, coach and advise with the rest. Not only can they afford this but I actually think the quality of advice will be better because it will be a) consistent and b) constantly improved.

As regards start-ups, in 2015 we kick off with a comprehensive business planning course which covers all what you have referenced and much more. I estimate 150 videos at 2-5 minutes each. By going through the course the owner will build a plan and budget which can be compared to actual results in real time.

By the end of the course they will understand finance in terms of reading a Balance Sheet and appreciate why that is no where near enough. They will have built a sales forecast (linked to their marketing plan) which is all supported by KPIs. They would also consider structure (but not just for tax) and matters like IPR.

That knocks the socks off 99% of accountants with 99% of their clients.

As regards Damion, he (like me) is learning all the time, referrals are now his major source of new business, average price is increasing but he will continue to drive his practice with telemarketing.

Bob Harper

Crunchers

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Replying to Wanderer:
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By qad999
16th Dec 2014 22:30

but you said it was high quality business advice

Bob Harper wrote:

@qad999 - I never said I was perfect.

Bob Harper

Crunchers

 

... and you are charging a fair whack .. this is the sort of elementary knowledge (*) you should have at your fingertips to advise clients (they expect this or at least will appreciate this value added service as part of compliance work so they dont print a load of expensive letterheads to make an impression on potential customers, and then have to shred it all)  ... and there is a whole lot more you need to be familiar with when you start in  practice... 

its not going to be any good messing up a load of tax elections and then having to tell the client  that you're  "not perfect .. and just really "learning all the time "

(*) ps just google "trading disclosures regulations" or similar ...I'm sure there will be a link,  ... please do it , before someone shops you to the authorities and you get a nasty letter threatening a fine ( rest assured we are not vindictive like that) most of us are here because we like to help when we can ( and pick up some tips as well)

we just dont like being told we dont give value for money or provide decent business advice on top of compliance work... because we certainly do

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Replying to Wanderer:
By ireallyshouldknowthisbut
18th Dec 2014 12:04

.

Bob Harper wrote:

 

@YouReallyShouldn't - the truth is that most start-ups can't afford the advice in the traditional way so they don't actually get it.

 

 

And re our earlier exchange, well I cant speak for your clients, but my clients do get this advice. This is why they are my clients.

And what is more they do not pay extra for it as some "value added service", they just have to ask.

 Or often they don't ask, I spot the issue and try and help them. That is after all my main role, the assistant crunches I review and advise.

In your set up you just have the assistant I can see why you are struggling with your business. 

 

 

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By Bob Harper
17th Dec 2014 09:39

High quality

@qad999 - I know accountants don't like being challenged and they really struggle to accept that most of what they do (compliance) has little and reducing value...but it's the truth!

As regards business advice...I truly wish more accountants would learn to market, sell and deliver great business advice this because there would be less start-up failure, more profits made by all businesses and higher tax revenues.

But, please don't confuse management accounting with business advice.

Bob Harper

Crunchers

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By johnjenkins
17th Dec 2014 10:01

@Bob

What you don't realise Bob, is that for most start ups it's a culture shock. Most are not sales people so the confidence is not there. So they suddenly find themselves having to get the work, do the work, then get paid as apposed to getting their pay cheque every month.

Videos and other gimmicky sales stuff will not help them.

I do not know of any Accountant that does not give sound advice (yes of course there are some so-called Accountants that give crap advice because they don't know and try to waffle). It is ingrained into the job we do. It's natural. Obviously Bob, you do not have that natural ability and perhaps you should direct your talented sales techniques into something that doesn't require thinking about the client rather than yourself.

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By Bob Harper
17th Dec 2014 10:53

Culture shock

@John - Yes, I do realise that going into business for most start-ups (including accountants) is a shock. 

The videos we are working on are educational. They cover a wide very range of topics and go deep. With enough research there is no reason why these can't be world class...giving the very best business advice to UK start-ups.

To help deal with the shock of starting a business we have put together Mindset videos.

To give an idea of the depth we go into...one of the problems many start-ups struggle with is raising finance.So, we are just putting up seven videos which explain the different sources of finance and give the pros and cons of each.

The videos cover:

Personal fundsFriends and familyPeer to PeerBanksCustomers and suppliersFactoring and Invoice discountingAsset finance GrantsBusiness anglesCrowd-fundingVenture capital

What specifically does the typical accountant have to offer?

Bob Harper

Crunchers

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By qad999
17th Dec 2014 13:06

we do that stuff all the time Bob , and much more

sorry to disappoint you.. there's absolutely nothing new in that list of yours

 

clients dont want to watch some tiresome standardised video (that they struggle to stay awake through )

when they have a problem, most of them like to come and see us , why do they take the time to do that ?   because often its very private and sensitive information they want to discuss face to face (and  not at their office/factory) and also they want to get to the point of the issue quickly

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By qad999
17th Dec 2014 13:25

I've got a better name for Bob's franchise

ZERO......  :0

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