My client proudly reported her two new client wins. Just as I was about to start celebrating, she then mentioned in a quiet voice that she had lost two new clients. They had apologetically told her that friends had just set up an accountancy practice, and so they were going over to them. But, if they mucked up they would be back very quickly. Some small crumbs of comfort!
I’m sure my client isn’t going to be the only small accountancy practice who will be losing clients to new accountancy practices. You don’t have to be an economist to realise that the number of new accountancy practices starting up is always heavily linked to the state of the economy. Economy doing badly = businesses suffering = practices struggling = more accountants being made redundant = more new accountancy practices forming.
Interestingly it’s not just the small accountants who suffer from new entrants into the market in times of economic hardship. It’s all accountancy practices. I remember my days in BDO, when times got tough the big 4 always started to compete in the mid tier’s normal market.
By the way, although I have focused on accountants, the same holds true for all professionals – lawyers, trainers, coaches, consultants etc.
So, what’s the solution here?
1) specialise, specialise, specialise
Too many accountants tell me they have a specialism because they work with entrepreneurial owner managed businesses (or something similar to that!) This is not a specialism, because if you asked most owner managed businesses, they would say they are entrepreneurial. Having a target market size of 40 million businesses in the UK is not really specialising is it?
If you are truly going to embrace specialisation (and all the benefits with which it brings) then you need to define:
* what sector does your ideal client operate in?
* what demographics are common to your ideal client?
* where in the country will your clients come from?
* what size of business (or household income) will your ideal client have?
A declared specialism, when backed up with the specialist knowledge that comes with it, helps you deliver extra value beyond the work you have been asked to complete by your client. It’s this extra value which can often mean the difference between keeping or losing a client.
2) Stay close to your clients
If you only speak to your client once or twice a year then, it’s not surprising that they may be vulnerable to a competitor. So, get into the habit of keeping in touch with your client outside of the assignment.
3) deliver on the basics
Never mind about delivering extra value, if you are not delivering on the basics then you deserve to lose your client to a competitor.
What else would you add to this list?