In the third article of a series on how you can take the right steps to truly add value to your clients and transform your firm, author, CA and Founder of Spotlight Reporting Richard Francis goes into the specific types of growth plans your firm can explore and achieve.
His most recent article laid out how you decide on a growth strategy. Here, he maps out the kinds of growth you can choose from, specifically: Revenue, Profit and Value as well as what is involved in each path.
In crafting your firm’s growth strategy, you need to first think very carefully about the type of objectives you want to set.
All too often, there is an assumption that advisory practices are all about expansion growth; expansion in fees may not necessarily be a key priority for you, or it may be for just a defined stage of your business journey. Here are the growth paths you can choose for your practice:
1. Revenue Growth
Over the years I have had the privilege of advising a number of high-growth businesses. These days I still sit on a couple of Boards where growth is a recurring theme, as it is for Spotlight Reporting now that we are operating globally.
A common attribute of growth businesses is a conscious decision to grow. Growth expectations and methods are agreed, as is the type of growth that is required.
Four huge revenue growth opportunities (beyond the expansion of core services into advisory, that most of this book covers off) are:
- Word of mouth referrals
- Verticalization (or specialization); and
- Global engagements.
Whatever lens you look through, the best revenue is often sitting right under your nose. Clients who are already satisfied and engaged can have additional services sold to them more easily than it is to sell to prospects.
Upsell in the accounting context means offering an expansion of the same services; an additional meeting, more frequent Spotlight Reports, movement between one package of services to another. The addition of brand new services and/or the sale of advisory services in addition to existing base compliance will be possible for many of your clients, including businesses and family groups.
I recommend that you have a defined process to identify and action upsell opportunities. Bake it into firm, team and individual KPI’s too.
Word of mouth referrals
For accounting practices, it is easy to grow organically by referrals if you look after existing clients well. Don’t be afraid to ask clients for appropriate referrals proactively.
You can actively seed referral streams from banks, lawyers, financial advisors and even other accountants. Again, if you’re delivering value and a great customer experience, you’ll stand out from the crowd and grow the cadence of third-party referrals.
The risk of referrals is that you get addicted to a flow of new fees and your acceptance criteria can slip back to the old "a wallet plus heart-beat" criteria that many firms find acceptable. This doesn't necessarily seed the right type of growth, nor are random referrals a very filtered way of growing a client base that fits your new value-add model.