5 ways to reinforce value with clients

September 9, 2020 11:48 AM

Accounting firms have been operating in an increasingly competitive market for some time now, leading firms to search for new ways to attract business and offer more value to their current clients. Clients’ expectations are constantly shifting, and that’s never been truer than in recent months with the COVID-19 pandemic sending businesses into a state of uncertainty. Now more than ever, accounting firms need to look for new ways to expand their offerings and establish themselves as trusted advisors for their clients. While finding new ways to demonstrate value can be a struggle for firms, a recent report offers valuable insights into clients’ expectations and priorities when it comes to accounting firm services. In partnership with CPA.com and Hinge Research Institute, Bill.com released “Where Opportunity Meets Value: Business Model Trends for Accounting Advisory Services” in June 2020, which compiles the responses of over 650 accountants and business professionals across the country to determine trends in successful accounting firm offerings.

Based on the responses from the survey, we came across data points and metrics that provide insight into five actions firms can take to position themselves correctly to ensure they are providing the right value for their clients.

Identify your clients’ most pressing challenges

It should come as no surprise that clients are willing to pay their accountants more when they get help in solving their most pressing problems. But surprisingly, less than 40 percent of buyers reported receiving assessments or tailored recommendations from their accountants, even though 64 percent of accountants reported that they do conduct an assessment. This disparity suggests that there’s a lot of ground to be gained in this area and that to know your clients better can open the door to offering new services. Part of the disconnect may be in how and when these assessments are made. If your only assessment of a client’s needs happens at the beginning of the relationship, you may be missing out on what their key challenges are today.

When our survey ran in late 2019, 19 percent of survey respondents cited planning for growth and expansion and getting expert financial insights; 18 percent reported having problems controlling cash flow and minimizing overhead costs; and 17 percent cited staying in compliance and lacking the necessary time to focus on accounting and financial matters when asked for their top challenges. Today, these challenges may be even higher value as businesses adjust to a new world. Tailoring your services to the specific challenges of your individual clients is a compelling way to convince them that you have value to add.

Know your clients’ priorities

Clients have clear priorities when it comes to what services they view as most valuable. The buyers surveyed ranked accounts payable/bill pay, forensic accounting, data analytics, and technology as the services they want their accounting firm to offer. Tailoring your offerings to match the services your clients prioritize most is one of the best ways to ensure that you’re continuing to offer value as a proactive advisor. The services your clients prioritize often go hand in hand with solving their greatest challenges. Not all accounting firms provide these services, so diversifying your offerings is a noticeable way to place yourself ahead of the competition.

Focus on proactive, strategic advisory services

Many accountants are finding themselves tackling new roles with their clients today — those of loan advisor, counselor and even therapist. At the core, these functions are rooted in strategic advice. Firms can look for instances where they can proactively provide clients with strategic advisory services as another way to increase the value they offer, especially now. This has proven a solid revenue growth opportunity for accounting firms, with firms reporting that they’re able to increase monthly client revenues by up to 50 percent when they offer these services.

One popular way to begin offering strategic advisory services is by bundling your new, high-value services with the more traditional services you already offer. More than half of the buyers surveyed indicated that they purchase packaged accounting services, and nearly 60 percent of accountants reported offering strategic advisory services. The buyers surveyed reported spending $1,108 a month if they did not currently purchase advisory services, while those who do purchase advisory services spend an average of $1,585 each month.

This indicates that buyers see great value in strategic advisory services, and in fact, they reported expecting to pay 50% more for accounting packages that bundled strategic advisory and traditional consulting services together. The most valuable strategic advisory services identified by clients were revenue growth and business modeling (65 percent), budgeting (46 percent), tax planning (38 percent), risk management (38 percent), and advanced KPI reporting (35 percent).

Institute value pricing

Value pricing is one way today’s accounting firms are adjusting their business relationships with their clients as services shift, and it has widely been recognized as a key means to boost revenue. It boosts more than your bottom line, though - value pricing can also help create a transparent relationship with your clients. Respondents widely recognized the benefits of adopting value pricing in the recent survey. When asked to identify the top benefits, 64 percent said transparency between buyer and seller, 60 percent cited the ability to demonstrate firm expertise, and 59 percent highlighted a lack of billing surprises. Each of these benefits of value pricing enhances the customer experience, offers better customer service, and increases client satisfaction.

Introduce automation

Many accounting firms want to institute value pricing, but some are still unsure how to do it. Automation is key to successfully switching to value pricing and maintaining successful price increases for expanded services. According to the survey, accounting firms are almost 3.5 times more likely to be successful with increased rates when they communicate the benefits of automation to their clients.

Automation allows both accounting firms and their clients to spend significantly less time on repetitive, low-value tasks, increasing efficiency and accuracy in the process. It also frees firms up to focus on alleviating their clients’ challenges. Among the firms that responded to the survey, the 27 percent that considered themselves to be highly automate consistently reported experiencing fewer challenges than their less-automated counterparts. Similarly, highly automated respondents reported less internal resistance to automation (just 25 percent), while 40 percent of respondents with little automation experience this problem.

Finding new ways to provide current and future clients with increased value is the key to accounting firm success in today’s competitive market. By getting to know your clients’ needs and priorities, tailoring strategic advisory services to address them, and instituting value pricing with the help of automation and other technology, your firm will be in the best position to demonstrate the added value that will make you stand out from your competitors and secure long-term relationships with your clients.