Who is the elephant in the room of accounting technicians and bookkeepers? It’s not the cloud-based accounting software suppliers who are aggressively marketing to all sectors of business (after all, it is the bookkeepers who can help make their products and services look good and deliver). It’s the accounting sector that is the “elephant” in the room.
Not all accountants are competing with bookkeepers, rather, it’s mid-sized firms and even the ‘Big Four’ which are active in the bookkeeping ‘solutions’ marketplace. Actually none of this should be bad or threatening; indeed it’s natural for an industry going through so much change, that there be a jostling of positions.
It’s also not surprising because bookkeeping is actually a highly profitable industry. Financial information company Sageworks reported that bookkeeping businesses scored a Net Profit Margin of 19.6% (12 months ended August 27, 2015). This was the highest margin of all industries including ‘Legal services’, ‘Activities related to real estate’, etc. This fact may come as a surprise to bookkeepers who struggle to hold their rates (often under $50/hour) but it would not surprise business-minded bookkeepers who are operating successful and profitable bookkeeping businesses.
Competing with the elephant
Keeping and winning new clients is a real and present challenge – even without the interference of the elephant. Questions abound:
• How do you get new clients, from the beginning as well as on a regular basis?
• Is there a way to jump start your bookkeeping business using cloud-based accounting software with multiple add-on options?
• How can you best market your services and get referrals coming in regularly? And, finally,
• How can you make the a switch to more lucrative advisory-type services that can be compelling for the client
Mindset
The best way to meet competitive and disruptive challenges is to adopt the appropriate mindset. It’s the foundation for all other activities within your practice or business. The fundamental is ‘walking in your client’s shoes’. If you’re constantly asking them for information, and they’re constantly late, then both get cranky and you risk your client becoming annoyed because they wanted ‘the books’ handled. Get your systems in place so nothing stalls. And ensure the ‘right’ conversation take place. Some key conversation points could be:
• What is the #1 reason you want to hire a professional bookkeeper?
• What results do you expect?
• How is your bookkeeping getting done now? Are your records up to date?
• What reports do you need to help you best manage your business? Aged debtors list? Cash flow forecast? Other?
Effective marketing methods
‘Effective’ marketing comes from building relationships and leveraging proactive, online and in-person strategies. And who is best-positioned if not the bookkeeper who is in regular contact with the business owner? Marketing that gets results needs to become a regular practice, not an event.
The challenges faced by this industry are not small. And we strive to keep our members informed with guides, podcasts and membership benefits that ensure they are ‘tooled’ up to build a profitable bookkeeping business.