6 Tips for Enjoying a More Lucrative Business
As a small business owner yourself and as an accountant who continually interacts with small business owners, you should always be on the lookout for ways to increase profits: your own and that of your clients. Doing so makes you a much more valuable accountant, not to mention, a much more profitable small business owner. What are some simple things you can do to accomplish that?
1. Remember the 80/20 rule
Also known as Pareto’s Law, this rule states that 80% of your business comes from 20% of your customers. Do you know which of your customers comprise that 20%? If not, it’s time you found out. You can then target them for special promotions and service offerings.
2. Getting that 20% to retain more services more frequently
Now that you know which clients comprised that valuable 20%, you must try to get them to use more of your services more frequently. In these newsletters we often return to the concept of geometric growth which means you expand your service offerings so that you are billing current clients more often. Geometric growth also enables you to attract new clients who might be interested in more than just your new services. This tip may require you to add complementary services to your menu, like QuickBooks consultations or tax preparation. But the effort would pay off in increased profits.
3. Determine what motivates the 80%
By focusing on the 20%, don’t forget there is still value in the 80%. Studies show that it’s better to spend your time retaining current clients than it is trying to find new ones. That 80% represents a client base that is familiar with your services and value as an accountant. Now you need to determine what motivates them and how you might be able to get them to join the 20% by retaining more of your services more frequently.
4. Ask clients what they want
No one can tell you how to best serve your clients than your clients themselves. What do they need? Are there other services they wish you offered? What might get them to more readily refer your services to friends and family? You may discover things that are difficult to hear. You may also get the most valuable business advice yet! These clients will definitely offer more personal and specific information than you could get from any other source.
5. Demonstrate gratitude
Nothing makes a client feel more valuable than by a genuine show of gratitude. This is also a good way to increase client retention and inspire loyalty in your clients. Whether you do this by giving them a modest gift (movie tickets, a gift certificate, or free lunch) or by thanking them personally for their business, it will be a gesture well remembered.
6. Show your face
You just can’t put a price tag on becoming a familiar face in the community. The more exposure you get the more free exposure your business gets. Ensure you’re aware of all the community events and, when possible, become a permanent fixture. Be especially aware of those that would afford you the opportunity to have a little booth from which you can distribute business cards and brochures about your services. Remember that everyone you meet is a potential client and may associate with hundreds of other potential clients. In this it becomes a numbers game. The more people you meet, the greater your potential for increasing your client base.
These six simple tips can help you take the necessary measures to increase your business’s profitability as well as the profitability of those small businesses you work for. Allen Bostrom, President and CEO of Universal Accounting Center, has a lot of experience helping small businesses do just that, and he’s written a book about it called In the Black: Nine Principles to Make Your Business Profitable. Practical and easy-to-apply, you can finish this book one day and begin implementing those principles the next. To learn more about this book and some of the principles he shares, visit his website today!