[author: Mark Ferris]
A huge opportunity for Accountants is to use their knowledge of a Client’s businesses to identify new opportunities.
However, this will not ‘just happen’.
At the outset, Accountants should acknowledge that:
- NOT ALL Clients are a source of new opportunities
- Opportunity discovery’ should be part of the workflow process to increase the chances
- A good business opportunity is one which the Accountant can act upon. That means they offer a solution which adds value to the Client’s business AND they’ll get paid
An Accounting business in Colorado Springs set out to find an additional $200K in new business from existing Clients over a 6-month period. Here is the 7-step process they set up… which helped them to exceed their revenue target.
1.Client Selection
- Not all clients offer opportunities beyond compliance. (In fact, the number can be quite small…though the rewards from selected clients could be considerable).
- This firm has considerable skills in the professional services sector…so focuses there.
2.Product Definition
- Figure our what you want to sell (and NOT sell)
- This firm has has success in guiding clients through ‘profit improvement programs’
- These programs establish goals, identify cost-saving opportunities, and execute on these
- The programs include an INITIAL REVIEW (45 days to develop recommendations)and FULL IMPLEMENTATION (a 6-12 month implementation program)
- Tailor products around what you’re good at, what you enjoy, and your track record of success.
3. Preparation: Trend Analysis
Perform a three-year trend analysis using these client metrics for insights into the business AND to stimulate conversation with the client:
1.Revenue
2.Gross profit %
3.Net profit %.
4.Cash balance
5.Days in receivables
6.Days in inventory
7.Days in payables
8.Current ratio
9.Any other KPIs of particular interest to this Client?
4.Preparation: The Business Direction
Each target client is different but follows this process:
succession, survival, asset protection, lifestyle, etc.
2.What will make the biggest impact on profit (revenue)? E.g. More customers? More revenue per customer per annum? Increased price? New products?
3.What will make the biggest impact on profit (costs)? E.g. the largest expenses? Any savings opportunities?
4.How will changes to the above factors impact cash flow?
5.Are there any significant risks to this business? E.g. regulatory, financial, legal, market, etc.
6.Are there tax minimisationopportunities?
7.What other opportunities arise from the owner's goals mentioned above
5. Teamwork
1.Ask the Accountant doing the work to prepare information on Steps 3 and 4 above
2.Meet with the Accountant, Client manager and (junior) Accountant to discuss
3.Use a Template to structure your meeting
4.Be open to ALL ideas. Encourage innovation, creativity and initiative
5.Give each opportunity a rating: high, medium, low
6.If ‘high’ or ‘medium’, request a meeting with the Client and share the analysis (optional)
7.If ‘low, take no further action
8.Involve the team in Client meetings so people can learn and participate
6. Behave like advisor and analysts
- Many Accountants claim that they want to provide more advisory services...
- ...But when required to perform simple analysis, they are indecisive and cite a lack of time
- We encourage Accountants to develop analytical / advisory skills OR stick to compliance
- Leaders should set high standards for Accountants. That is how they will progress
- Some tools (like Strategize, GrowthEquation, Futrli, Spotlight, Corvee etc.) can be useful in this process. But they are NOT a substitute for a business advisor / analyst.
7. Track Progress
- Meet monthly to discuss the number of Target Clients, meetings, proposals, closed deals.
- Talk about what has worked well... and not so well. Refine the process accordingly.
- Keep the team updated on developments, especially successes. Celebrate!
