How many times have you sat with a client and given them consulting advice without getting paid for it?
It was a question Coenie Middel of Middel & Partners asked delegates at the Practice Management Bootcamp for accountants, held at the Maslow Hotel in Pretoria last week.
The question drew nervous shuffling and embarrassed laughter. Sometimes accountants are simply too timid to recognise that the client is now delving into another service channel altogether.
Middel (pictured above) handles this by separating the accounting and the consulting functions. When a client asks for advice outside of the normal accounting function, such as what IT platform to introduce or how to go about valuing a particular asset or business, the reply should be: “My colleague at the office deals with those issues. Why don’t I bring him around in the next day or two so we can go over that.”
All of a sudden you have turned free advice into a paid service. Middel said he has seen revenues from certain practices double when this approach is adopted.
There is nothing unethical about this. Most accountants are vastly under-selling themselves. Once you separate the accounting and consulting functions, you now have created a new revenue stream.
Etienne Boshoff of Boland-based Boshoff & Moore explained how to turn a small accounting practice in the middle of nowhere into a success and thriving operation.
“I bought a small practice when the previous owner retired, and I found as you grow, you need to find the right staff – not just more staff, but the rights ones,” he said.
One inevitable challenge as you grow you client base is the decision whether or not to merge with another firm. Eventually Etienne decided to merge his practice with Wuanita Moore’s to form Boshoff & Moore. “One is always nervous of taking on a partner, because you never know what you are getting into,” said Wuanita (pictured above). But in our case it worked out very well.”
Moore resigned as an audit manager in 2012, and decided to team up with Boshoff. They have since doubled their team and their client base has steadily grown by 15% per annum, maintaining a stable increase of billable hours of between 16 -18% per year. Moore was selected as one of SA Institute of Chartered Accountants (SAICA) Top 35 CAs under 35 finalists. She is also a member of the Boland Belange Groep: a discussion group for CAs in practice in the Boland district.
Middel said there will always be people better at certain functions that yourself, whether it be in the technical aspects of accounting, tax, communicating with clients, or dealing with bureaucrats. “If they are better than me at certain things, I want them on the team. We have nine partners, and we make it very easy to bring new people on board, but we also make it easy for them to leave. We have had to ask one partner to leave. You don’t have to be mates. The styles are different and you just have to suck it up. Some partners are good doers and bad communicators. Others are great at networking. As a team you can build on these different strengths.”
Wuanita Moore said her practice had 40 non-profit organisations that were not profitable, but gave the firm access to a vast network of potential clients.
Middel says his firm had hired a marketing specialist: “It’s expensive, but this has brought us in business.”
Just as you must sometimes fire a partner or staff member, so must you be prepared to fire a client – especially clients that do not heed your advice, said Boshoff.