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By Adam Lean, Co-Founder & CEO, The CFO Project.
In my role as CEO of The CFO Project, a community that helps accountants start and scale CFO/Advisory practices, I’ve noticed that many accounting and bookkeeping firm owners are stuck in what we call The Accountant’s Trap.
What is the Accountant’s Trap you might ask? It’s where financial professionals are trapped working long hours for low fees, are forced to deal with high-demanding clients,while being burnt out on compliance and transactional work.
To make matters worse, these firm owners can’t raise their fees because there is always another accountant or bookkeeper willing to do the work for less,not to mention all the tech companies trying to get into our space.
So, how does an accountant escape this trap? We recommend offering advisory services to your clients. I’m going to reveal the top five reasons why offering advisory services will help you escape the trap, but first, let’s get on the same page as what, exactly, are advisory services?
What Are Advisory Services?
Your business clients have one goal: to have a growing and successful business. Period.
Advisory services are where you, their trusted financial professional, help them stay on-track to accomplish their goal of having a growing and successful business. That’s it.
If you can do that, guide a business owner towards having a growing and successful business, you will succeed at being a business advisor.
Here’s the thing: there are not that many people in the average business owners’ life that can guide them not only on how to stay in business, but how to have a growing and successful business.
It’s no wonder that, according to the U.S. Bureau of Labor Statistics, most businesses fail. Despite the plethora of business books, business coaches, and business training programs available to business owners, they still fail.
They fail precisely because most business owners are skilled at the craft of their business – not at the ability to have a financially successful business.
Think about it: A dentist starts a dental practice because they’re trained in dentistry. A chef starts a restaurant. A construction worker starts a contracting business. An architect, an architecture firm. Most business owners lack the one critical skill needed to stay in business: the ability to generate positive cash flow on a consistent basis.
So…they fail. And they fail at alarming rates.
Imagine if someone like you, someone they already trust, is willing to guide them – to advise them – on not only staying in business but having a thriving business – they will pay you whatever you command.
Why? Because their business is not a hobby for them. It must work.
Their pride depends on it working. Their families’ livelihood depends on it working. Their employees depend on it working. The bottom line is this: a business owner craves someone that they can trust, to guide them on having a growing and successful business.
This is what offering an advisory service looks like. Now, let’s look at the five reasons offering an advisory service will help you escape The Accountant’s Trap.
The Five Reasons Offering Advisory Services Will Help You Escape the Accountant’s Trap
Reason #1: There’s demand.
As mentioned above, small-and-medium sized business owners crave someone like you in their lives that can help them have a growing and successful business.
By offering advisory services, you can upsell existing tax, accounting, or bookkeeping services to advisory services. At the same time, you can cross-sell your advisory clients to your other services (e.g., tax, accounting, or bookkeeping).
Reason #2: You’ll earn more.
Advisory services are seen, in the eyes of your clients, as a higher value service. Therefore, you can charge more for it.
On the other hand, tax and bookkeeping services are seen, in the eyes of your clients, as commodities. A necessary evil. Something that simply just must get done. Therefore, the lowest priced provider often wins.
So, how much should these professionals be charging? The range we usually see is between $1,500 and $5,000 per month. It only takes a handful of clients to make six figures.
Reason #3: You can work less.
By offering ‘productized advisory services’. It’s where you’re offering a specific set of deliverables and outcomes to your client instead of what most fractional CFOs/advisors do. Most fractional advisors create a custom engagement to fit the needs of their client. This is not scalable, and each client will feel like a part-time job.
Instead, by offering a productized advisory service the way we teach it in our community, it only takes four hours per month to service a client.
Reason #4: You’ll have a bigger impact.
Most accountants I’ve met truly want to help their clients. However, because they’re stuck doing compliance or transactional work, this leaves little time to provide the true help the client really wants.
By offering advisory services, you’ll have a much bigger impact on your clients’ lives because you’re helping them have a growing and successful business.
This impact will be more than any bookkeeping, tax or accounting service could ever provide.
Reason #5: You can get off the marketing roller coaster.
Advisory clients have a very high retention rate. This means that, once you get a handful of clients, you won’t have to spend your time looking for new clients.
Plus, once your client experiences your advisory services, they’ll tell their friends which means you’ll enjoy word-of-mouth referrals to grow your practice.
The Bottom Line
I‘ve mentioned it several times already, but it bears repeating: the only thing a business owner really wants is to have a growing and successful business. And a successful business is defined as a business that is able to generate positive cash flow on a consistent basis.
The issue is most business owners just don’t know how to accomplish this goal. This is why they need someone who does know how to do it to advise them.
This is why advisory services are important – and worthwhile to your clients. And worthwhile to you, too. Advisory services are something your clients want and need, something that gets them a growing and successful business and something that allows you to start charging for your value and not your time.
By offering CFO/advisory services, you’ll finally be able to escape The Accountant’s Trap and get your life back. You’ll make more money in less time all the while having a huge impact on your clients’ lives. And, you’ll enjoy your work again.
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