I believe the number one growth opportunity for accountants in public practice is to convert an existing compliance client into an advisory client and then generate up to 7 new revenue streams per client.
Our research confirms accountants want to grow their top line advisory fee revenue and attract new clients to their practice. Taking an existing compliance client and converting them into an advisory client supports both these goals:
- Using your existing relationship to identify other key client needs both:
- Generates new advisory revenue streams
- It is usually more efficient than marketing to potential new clients
- The best source of new client referrals is from existing, satisfied clients
If this is THE # 1 growth opportunity, how do you create an advisory client from an existing compliance client?
The first step is to examine your client base and identify your ‘ideal’ clients for advisory services. The Industry rule of thumb for client segmentation is:
- 20% are already engaged and 30% will never engage;
- 50% have aspirations to grow and improve their business; these are your target ‘ideal’ clients for advisory services.
Needs Review Process
Once you have identified your existing ‘ideal’ clients, the next step is to integrate a client Needs Review process which targets those clients. SME research confirms that, on its own, a needs analysis/fact find, is not enough to secure you an advisory engagement. To engage using this approach, your client must have an URGENT need to act.
Leading accounting practices are implementing a 3 step Needs Review process to secure 7 out of 10 advisory engagements:
- Needs Assessment Discussion – to position advisory services and identify your client’s top concerns
- Needs to Solutions Meeting – to secure engagement by employing 4 tactics
- Ongoing Education Campaigns – to educate your ‘ideal’ clients on the benefits of working with you in an advisory capacity.
Successful advisory practices leverage the Needs Review process. This is essential to generating substantial advisory fee growth rates. In these practices, Supervisors, Managers and Associate Directors have the primary responsibility for introducing the Needs Review process to their existing compliance clients.
Team of Experts
Your clients will need other expert services, outside your area of practice. To keep your position as your client’s trusted adviser, it is important that you can refer clients to a trusted team of experts. This allows you to maintain the key CFO/Board of Advice role with your clients, by assisting them to obtain services such as:
- Financial Services
- Banking and Finance
- Superannuation and Wealth Management
- Non-Financial Services
Do some homework – determine the advisory services fee growth potential for your practice:
- Prepare a list of existing compliance business clients
- Multiply this number by 35% (50%, (targeted clients) * 70% (Needs Review conversion rate)); and then
- Multiply this amount by your current average client advisory fee to calculate your practice fee growth potential.
If the numbers stack up, engage your practice trusted adviser to support you to build a successful advisory practice.
Bstar supports accountants and other professional advisers to grow advisory services through research, education and online software solutions.