Why did you become a practice owner?
Was it to achieve freedom and autonomy? Were you financially driven? Or was it just pure ambition?
Whatever the reason was, you had to start somewhere.
And unless you bought into a practice that was already well established then I’m sure you’ll have had a fair amount of growing to do already.
Maybe you have reached a stage in your practice where you’ve got a good client base, steady cashflow and strong team?
(If you have, then you must be doing something right!)
Or maybe you have reached a point where you want to start growing again?
Now, it’s worth pointing out that growth isn’t for everyone. For lots of my clients, they don’t want to grow any more. If growth isn’t your goal, then this is the article for you.
But if it is, then I want to help you avoid making the mistakes many practice owners make.
See, it’s easy to get carried away and start doing too much, too soon.
It’s no secret that more staff, more clients, and more services are 3 ways you can look at growing your practice.
But you’ve worked hard to get your practice to where it is now, so it’s important not to jeopardise its stability by diving into things hand over fist.
So, here are 3 things you should avoid when looking to grow your accountancy practice…
1. “Let’s take on more clients!”
It’s easy to understand why practice owners think winning lots of new clients is great for growth.
Clients are your income, your bread and butter, and more clients usually means more cash in the bank.
But if you go on a mad hunt signing every Tom, Dick and Harry who needs an accountant you could be shooting yourself in the foot.
A rapid influx in clients will mean your current team members will be stretched, and their workloads will increase.
And these increased workloads have the potential to:
- Cause client care and experience standards to slip
- Increase your practice turnaround time
- Impact team satisfaction and morale
- Affect client satisfaction
- Cost you in overtime pay if workloads get too high
If you are looking to grow your practice, yes you may want to increase your client numbers.
But the key is doing it at a pace that you can keep up with.
Because if you don’t have a clear idea of who your ideal clients are, you also run the risk of rapidly taking on the wrong people.
And taking on these problem clients will only make things worse, not better.
So sometimes, growing your practice doesn’t mean upping your client numbers.
For example, you may choose to focus on going deeper with your existing clients, offering them a range of additional services that allow you to get much more hands on with their businesses.
Reducing client numbers and providing additional value to your existing clients means you have the potential to charge a LOT more for your services instead – which will drive up your revenue.
2. “Let’s hire more staff!”
It could be the case that you’ve taken on more clients and your current team are stretched…
Or you might want to hire new team members so you can take on more clients.
Whatever the reason, when looking to hire more team members it’s important, like the client numbers, to increase at a reasonable pace and to consider why you are doing it.
Simply hiring one more person to your team can impact your team dynamics.
You’ll have to spend time training them, introducing them to your clients and processes and they will cost you more money.
So, doing this in large numbers becomes more complicated.
Not only can your cashflow take a hit but you’ll be at risk of team mis-communication, lack of direction and your clients may experience a drop in service as a result.
When looking at changing your team for growth purposes it’s important to consider:
- What level of growth can you afford without affecting cash-flow?
- Who is going to oversee the growth plans?
- How new team members will fit into your organisational structure?
Again, you want avoid disrupting your current team dynamic and system.
Only hire if you think a new team member will fulfil a need or purpose.
3. “We need to offer more services!”
With increased competition in the industry, it’s important to consider providing your clients with additional services as well as the general compliance work.
(This is not to say that compliance is dying – but rather that providing additional services can sometimes give you a competitive edge…)
Additional services such as…
- Business Planning
- Tax Planning
- Financial Advisory
- Cash-flow forecasting
- Coaching & Mentoring
- Virtual CFO
…can really increase your value to clients, which will mean you can charge them more.
And this is great when looking to increase your income and grow your turnover.
But if you rush into quickly adding more services you will risk increasing your team’s workload for no positive return.
And you’ll also risk not being able to deliver the high quality your clients will expect.
When thinking of adding additional services, first make sure you have the right team members to deliver the services.
As you may have a team member who is the Usain Bolt of tax returns…
…but not so hot when it comes to tax planning.
Take your time.
Take time to consider what services your clients will value, who can be responsible for delivering them and how you’ll position the new services and price them.
This way you’ll actually be able to increase your services without impacting your team and client satisfaction.
Fools rush in
I’m not talking about the questionable 1997 rom-com.
Rushing anything without putting the necessary thought and consideration into it is a straight path to problems.
And this applies to you when growing your accountancy practice.
In order to grow with stability, you need to ensure that you have a clear plan, systems and the right team members in place to oversee it.
Growing too fast by adding more staff, services and clients too quickly can cause serious cashflow problems and your clients may not be getting the level of service they need.
If you’re looking to grow your accountancy practice, here are some additional articles to help you on your way: