Over the past few years, much has been written about tax and accounting firms becoming one-stop shops. In theory, clients would be able to get their taxes prepared, their life insurance checked, their wills written, their mortgages refinanced, their software installed and their portfolios diversified in one convenient location, overseen by a trusted advisor – like their accountant.
On a larger scale, this strategy is less than a stunning success. The conglomeration of accounting firms pioneered by American Express, Century Business Services and H&R Block, rocked the industry in the late 1990s and many assumed independent firms were in danger of becoming extinct.
But a funny thing happened on the way to integration. It didn’t really work very well. Managing a huge and far-flung company composed of accounting firms, human resources professionals, financial planners, and other disparate professionals proved difficult for the acquirers. And many of the acquirees felt lost in such a large enterprise where they were either explicitly or implicitly urged to cross-sell the company’s other products.
Some accounting firms eventually bought back their practices and wrote the saga off as a failed experiment. The rest are still plodding along, hoping that the promised synergies will eventually take place.
Meanwhile, small and mid-sized firms have been stealthily creating their own one-stop shops, and forging even stronger client relationships as a result.
Last week, my husband and I went in for a mid-year tax review with our accountant. It was the first time we took advantage of this service, but felt it would be a good thing to do.
Before he could even mention the new tax law, my husband and I peppered him with questions about our term insurance coverage (which is set to expire later this year), our 401(k) plans, tips on household budgeting, and the fact that we haven’t changed our wills since the twins were born three years ago. We also sought advice about whether to open a 529 plan for our girls’ college education with a check my mother gave them on their third birthday, or whether another investment would be a better choice.
During our hour visit, we filled out forms for new 20-year term insurance coverage (at the rates we were paying for five year), made an appointment for a free consultation to see the office’s attorney regarding our will, and took home information on a few college education options.
When my husband asked what the charge for the day’s appointment would be, our advisor candidly said it was a free service to help with client retention.
“If I see the two of you mid-year and go over your tax situation, chances are pretty good you’ll come back to have me prepare your taxes next year,” he said.
“Sucker!” I quipped in response, but he’s right – we’ll be back. Especially now that, with all the services he’s providing us, he’s truly become our trusted adviser.
