Beat the recession masterclass, part four: Your action plan

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In part four of this multi-media series, leading strategist Steve Pipe FCA explains how accountants can structure their systems of support for clients battling the economic crisis.

Parts one and two of this series offered overwhelming evidence that practitioners need to do more to help clients beat the recession, while part three explained how this can be done in a way that benefits the practice. This instalment will describe how to build the rest of your action plan and outline the 19 specific areas that accountants must be able to help clients with.

First, let’s address a comment I heard uttered by a partner recently:

“Our clients don’t want us to help them beat the recession. All they want is to spend as little money as possible, so we aren’t going to do anything extra for them”.

This is demonstrably untrue and it could cost the firm dearly. In fact, one estimate of the ‘cost of complacency’ for firms that don’t do the right thing for clients in the recession is £100,000 per partner (see part two for the calculations behind this estimate). However, even £100,000 greatly underestimates the true cost of complacency. To see why, let’s analyse the three components of this statement in turn.

“Our clients don’t want me to help them beat the recession”
This is almost certainly false. Research published this year shows that 82% of clients want their accountant to give them more help to beat the recession. This partner had no evidence that his clients were all in the bottom 18% who didn’t want help, and he certainly hadn’t asked them whether they wanted it. He was merely making an unsubstantiated guess; a guess that flew in the face of the research and common sense (after all, logic suggests that given the choice between getting help to beat the recession and being beaten by it, many clients would opt for the former).

Guessing in this way is highly unprofessional. After all, the same partner would not dream of guessing the numbers to put on a clients tax return. Their professionalism would demand that they pick up the phone and establish the facts, and yet on the far more important issue of how to respond to what Warren Buffet has called “Economic Pearl Harbour”, he was willing to make a decision based on pure unsubstantiated guesswork. This is highly unprofessional. The bottom line is that you must not guess, you must find out by talking to clients.

“All they want is to spend as little money as possible”
All clients will fall into two categories: those who are willing to spend money on beating the recession, and those who aren’t. In this context there are four key points that need making:

  • You can’t guess which category a client falls into. Find out by proactively offering them help in an effective way.
  • Some clients are too proud to ask for help to beat the recession since they see it as an admission of weakness, so again it is your professional responsibility to proactively offer help to them in an effective way.
  • Those who are willing to pay for help should obviously be helped and to do otherwise is both commercially and professionally negligent.
  • Those who are not initially willing to pay for help should be offered some free input for three reasons: firstly because in these times of unprecedented economic difficulty you have a moral responsibility towards them as their trusted adviser; secondly because by helping them to stay in business you make them more likely to stay as clients; and lastly because, in many cases, after they have had the free input they will ask you to provide further support on full fee paying terms.

The bottom line is that it doesn’t matter whether they are willing to pay or not.

“We aren’t going to do anything extra for them”
As the above has shown, if you are going to live up to your standing as a trusted adviser and true professional, then you simply must do something extra for clients to help them beat the recession. In fact, you need to be able to provide two main kinds of help:

  • Some for free (i.e. things that have low cost to you but high value to the client).
  • Some for a price (i.e. things that have high value to you and to your client).

19 areas where accountants must help
To help you decide what sort of ‘beat the recession’ assistance your firm should offer, below are some key points AVN members use to educate clients and prospects about what a good accountant will do for them:


  1. Carry out a comprehensive diagnostic review and produce a report to identify the key options for strengthening cash flow.
  2. Explore sources of cash to see which have the most potential for you.
  3. Provide a performance measurement and improvement system and help you summarise everything that really matters of a balanced scorecard or one page plan to ensure you have all the information you need to make informed decisions and get better results.
  4. Help you understand and manage your breakeven point so you are more able to survive falls in demand.
  5. Benchmark you against others in your industry to identify areas where you can most easily improve.
  6. Create an initial improvement action plan covering all the key areas.
  7. Attend regular meetings with you and use a BoardView style methodology to help you continually update your action plan in the light of new issues, information and opportunities as they arise.
  8. Produce regular cash flow forecasts to ensure that your plans can be funded and you do not get into financial difficulties.
  9. Give you free access to a library of ‘beat the recession’ resources, e.g. videos, software, reports, etc.
    Sales, profit and debtor collection help
  10. Identify which profit drives have the greatest potential for you.
  11. Review profit strategies that lie behind the profit drives and help you prioritise and action them.
  12. Identify and manage your profitability by customer and/or product line so that you can build on your higher profit areas and deal with your lower profit areas.
  13. Analyse your sales pipeline and use sales improvement software such as SSTW to identify how to drive sales up.
  14. Evaluate alternative pricing strategies using software such as SSTW, since getting your pricing right is usually the fastest and easiest way to increase the profitability of sales.
  15. Guide you through ways to improve your debtor collection.
  16. Advice on how to pay no tax on the profits from new products/services/divisions for five to ten years.
  17. Explain how to cut your corporation tax, income tax, capital gains tax and SDLT bills to zero (or close to zero).
  18. Help you claim your full tax credit entitlement (it is surprising how much you can claim with specialist help).
  19. Outline how to use IHT and care home fee planning to put extra cash in your bank account during your lifetime.

Three step action planning process
To help you do the right things for your clients, there is a simple process that can be followed.

Step one: Tick all those items where you have evidence to suggest that at least 75% of your clients both (a) know that your firm already does this really well, and (b) have had as much input from you in the area as they could possibly benefit from.

Step two: If you genuinely have at least 15 ticks than you are probably already doing enough.

Step three: If you have fewer than 15 ticks, then you must make some rapid improvements.
To make the necessary improvements, talk to your existing shortcut provider (seek one out if you do not have one), or spend the time to develop your own solutions in each of the unticked areas.

Steve Pipe FCA
[email protected]
© Steve Pipe FCA, April 2009
Steve Pipe is the Chairman and founder of AVN and a leading researcher into the commercial issues and opportunities facing UK accountancy practices.

Beat the recession masterclass index
Part one: The brutal truths

Part two:The big opportunity

Part three:Where to start




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By eddybee
30th Apr 2009 16:42

Moving out of the comfort zone....
Another excellent article Steve -thank you .

I was interested in Mark's comments about the 4 partner firm. They may well also gain in the long run due to referrals into new clients whose accountants are not helping in the same way. At a time when some firms are downsizing, this approach can help relieve the pressure even if the extra profit isn't the desired amount.

Whilst some firms either have or may be able to quickly develop the required skills, for others this type of support may completely outside their comfort zone. These firms may wish to consider an arrangement with someone with commercial experience who can help their clients. Whilst the idea of introducing another accountant to clients is an anathema to many accountants, using the principle that it senseless to bite the hand that feeds you - any fears on this front are likely to be ill founded.

As regards rates - the traditional practice model for charge out rates assumes a slug of fixed overheads that have to be recovered. The market rates for outsourced financial management services are generally lower than practice rates (the overhead base is normally low). Where firms view this work from a traditional perspective they will struggle to make it work at normal practice rates - however if they view it as a low overhead add on service it can create extra profit and be rewarding work that helps clients where it really matters.

David Lewis
Camrose Consulting

Thanks (0)
29th Apr 2009 17:03


I forgot to mention…

… if you would also like some free shortcuts to help you implement the ideas in this article, please contact me on [email protected] and I will send you:

- a sample action plan
- a step by step profit improvement process
- some sample marketing letters
- and further practical tips


stev[email protected]

Thanks (0)
29th Apr 2009 16:08

Some firms are certainly focused on helping clients survive
I was talking with one of the partners in a four partner firm just yesterday. He told me that the partners were focused very much on helping clients even if they were not able to secure full fees for all of the partner time being invested.

Their view is very much that they want to help their clients to survive the recession. Their logic is simply that they have generated good fees from their clients over the years. Now that times are tough for clients they want to help ensure that those clients will survive so that they will be around to continue paying good fees in the future when the impact of the recession has passed.

Mark Lee
Tax Advice Network

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29th Apr 2009 13:24

Free marketing samples

If you want to see exactly how firms are using the 19 services listed above to win new clients and new fees from existing clients, please contact me on [email protected] and I will email you with samples of the marketing literature they are using.


[email protected]

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