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Top 10 Questions to Ask a Potential Client

Nov 9th 2015
Owner FitBooks Pro
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When you are interviewing a potential new client, allow yourself the chance to shine. You can do this by doing more listening than talking. Asking your prospect several directed questions kills two birds with one stone: it allows you to learn about their business and how much work needs to be done, and it allows you to let the client talk about themselves.

Stephen R. Covey says, “Most people do not listen with the intent to understand; they listen with the intent to reply.” People love to talk about themselves, and business owners love to talk about their business. Being a good listener will help you hook a new client. 

Keep in mind that asking great questions is an oblique way to demonstrate to your prospect that you know what you are doing, you are experienced, and you are an authority on your topic. When asking questions, if the prospect responds, “That’s a great question!” you know you have hit the nail on the head.

Top 10 Questions to Ask a New Prospect

1. What is your business entity?
It’s important to know if they are a Sole Proprietor, an LLC, an S-Corp or a C-Corp. The answer to this question will inform other questions which may arise.

2.  Are your tax returns current? When is the last year taxes were filed?
Be sure you know what you are getting in to! If things are up-to-date and last year’s tax return has been filed, great. If tax returns are three years behind, this raises red flags which you must consider when deciding whether or not to take on the client. Past due tax returns often signals the client is disorganized at best, and difficult to work with at worst. I might agree to take on a several-year backlog project, but I will request a sizeable up-front deposit first.

3.  How many accounts do you have, and with which institutions?
This seemingly straightforward question often yields interesting results. They will of course remember to list off their business checking and savings, and a credit card or two. More prompting may be required to discover if they have a PayPal account, personal or bank loans, equipment leases, car leases, etc. All these have monthly statements which need reconciliation, so take into account the extra time required each month for each statement when considering the job.

4.  How do you prepare your invoices? (A/R)
Find out if they are preparing their invoices in their accounting software, or if they use a third party like Freshbooks, or MS Word. If you have to re-create each invoice in the accounting software, that will take more time.

5.  How do you pay your bills? (A/P)
Are they writing manual checks? Printed checks? Using online bill pay? PayPal? Bill.com? Other? Each answer has different ramifications, particularly if they are using a system with which you have little or no previous experience.

6. Do you have payroll? 
I may have mentioned in other posts that I don’t do payroll. I require all my clients who have payroll to use a reputable third party payroll service, and I will enter their payroll into their accounting software after-the-fact. I do not want to be tied down to someone else’s payroll schedule and filing deadlines, and I don’t want to assume the liability for late or inaccurate payroll tax payments. What’s more, once I take on the engagement, I often find payroll has been entered incorrectly and the P&L payroll figures do not tie to the YTD payroll reports. Tread wisely where payroll is concerned.

7.  Do you have inventory?
Inventory is an entire specialty, which is not my specialty. Since I choose not to be an inventory expert, I will carefully consider whether or not to take on an inventory client. You might love it, or want to learn it, and inventory is a good vertical market in which to hang a shingle and become an expert.

8. Do you report sales tax?
This is another area of expertise and can be time consuming. It also requires tracking and meeting filing deadlines. Be sure to find out if they file sales tax monthly, quarterly or annually. Ask if the filings are up-to-date. You may want to dig deeper and inquire if they have ever had a sales tax audit, and if the answer is Yes, request more details.

9. How many hours per week do you estimate the work will take?
Don’t be surprised if they cannot answer this question. Often, it is best to ask the departing bookkeeper, if that is an option. It is surprising how often the business owner does not know all the tasks that  the bookkeeper performs, or how long it takes. So take any answer provided with a grain of salt.

10. Why are you changing bookkeepers or why did your last bookkeeper leave?
Clients really start talking when you ask this question. I’ve heard answers which include, “My last bookkeeper was mean to me and always yelled at me,” and “s/he never returned my calls or emails,” and “s/he never provided monthly reports.” You can be sure that if you listen to these complaints, and perform above and beyond their last bookkeeping experience, you will have a satisfied, long-term client.

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If you are satisfied with the answers to the above questions, all that remains is a final or 11th question: When would you like me to start?

Jody Linick is an AIPB Certified Bookkeeper  and a QuickBooks® Certified Pro Advisor.  Her company, Linick Consulting, specializes in remote bookkeeping services using hosted QuickBooks and QuickBooks Online. She asks her prospective and current clients a lot of questions, and always listens carefully to the answers. 

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