We are all familiar with the tax season crush -- that span between January and April 15. The hours are long. The work is never-ending. And usually the food isn't too great either. You are surrounded by numbers, forms and advice to "drink lots of water and get lots of rest."
Accountants will never escape the crush of tax season. It is just the way the profession is designed. However, that tax rush is offset by the off-season - the time when client demands are not as high and business can take a downturn in volume.
Can't there be more of a balance in the workload?
There are two distinct types of accounting firms. One -- the seasonal firm -- has a concentration of work between January and April, with a reduced workload after the conclusion of tax season. The other - the sustained firm - has a more consistent workload from clients that runs all year long. Let's examine these two types of firms.
Revenue. As previously noted, the seasonal firm -- because the firm is focused on tax work -- faces the brunt of work in conjunction with tax season. As a consequence, a majority of that firm's revenue will be realized in the first and second quarters.
The sustained firm, however, has expanded the practice to include "evergreen" services that are relevant and important year-round to clients. That ensures a continual stream of income that does not significantly diminish after tax season.
Services. The seasonal firm may focus mainly on tax services. This is a traditional path that is often embraced because companies and individuals will always need assistance with their taxes. However, what services is the firm offering beyond tax preparation? Do clients know additional services are available to them? Is it a priority to research, adopt and share new services?
The sustained firm embraces the adoption and marketing of new services in order to gain continual business from its clients. Beyond taxes, they research and share services that are always necessary and that often relieve clients of administrative work (bill payment, for example).
Price. The seasonal firm has a crush of work during tax season, and often that is the time span in which its accountants have the greatest amount of client communications and interaction. Because a client's exposure to the seasonal firm is limited, it impedes the seasonal firm's ability to create strong ties and trust.
This low threshold for (or even a lack of) trust can lead clients to view the contributions of a seasonal firm as solely a price-based service -- one that can be easily replaced should another firm offer a lower price.
The sustained firm, however, has numerous opportunities to interact with clients and to learn more about their business strengths, weaknesses and priorities. This leads to a stronger alignment with clients' growth strategies or goals. Because the sustained firm demonstrates a deep understanding of clients, its contribution to their financial needs is elevated to considerations beyond price.
Clients will hesitate to find replacement firms that might not have the depth of knowledge that the sustained firm does. In fact, the sustained firm may very well have the opportunity to raise prices with clients that truly value its services and contributions.
Standing. As mentioned earlier, seasonal firms concentrate a majority of services and client interactions during the January-through-April time frame. The main focus is to complete and file the necessary taxes for clients. This can, inadvertently and by its nature, impair the insight that an accountant from a seasonal firm has into clients' operations and the financial "big picture."
The flip side of that equation is that, due to the services being rendered and the limited interaction, the client might not even approach the seasonal firm for additional services or advice.
The sustained firm gains a far greater understanding of its various clients' businesses due to the fact that its services are integrated throughout a client's calendar year. Services rendered extend beyond tax processing to include bill payment, cash management and more. These tasks paint a larger picture of the company and set up the sustained firm as a trusted advisor that can impart CFO-level wisdom on financial performance and opportunities.
While a moderation of work may not be an option for accounting firms during tax season, it is a very viable and valuable option to adopt services and communications strategies that extend beyond this time frame.
By integrating further into a client's financial operations -- and moving beyond just tax season services -- a sustained firm can truly reap the benefits year-round.
Julie Lubetkin is vice president of strategic partners for Bill.com.
Register or login for access to this item and much more
All Accounting Today content is archived after seven days.
Community members receive:
- All recent and archived articles
- Conference offers and updates
- A full menu of enewsletter options
- Web seminars, white papers, ebooks
Already have an account? Log In
Don't have an account? Register for Free Unlimited Access