So many firms think that growth needs to be as a result of winning new clients. When our clients are in the second phase of growth and getting a firm foundation, we typically help them to grow significantly. Not by winning new clients - or actively trying to win new clients. But by increasing their fees. In this blog post, we consider the three ways to increase your fees.
The only ways you can increase your fees
There are only three ways to increase your fees. Yet many firms only think about one (as opposed to actively act on it), don't even think about the second and are petrified of the third. Where is your focus when it comes to increasing your fees and how might you change that?
A short diversion
We were in a hurry (again), having left late for the dive site. We were both driving (long story, for another day) and I was amazed at how my partner was driving. Being very aware of how late she was, the accelerator pedal was being well used (makes sense) and then having made use of every gap the brake pedal was used.
I hadn't worked so hard at pushing forward, I'd spent the time looking for opportunities to overtake and looked further ahead on the road to see whether it was even worthwhile. I'd not gone as fast, not used as much fuel, and got there more quickly.
There are only two ways to get to your destination faster, press the accelerator more or press the brake pedal less! Giving yourself the space to find the best balance is a good way forward.
Only 3 ways to increase your fees
Getting new clients is rewarding, both psychologically as well as financially (in many firms). There's the thrill of the chase, recognition by your team as a great hunter, the excitement of "doing the deal" and maybe even negotiating a great deal. It proves the individual, it may even demonstrate the firm's marketing skills; but it may be a waste of time.
I've always been told (and it makes sense), that it's easier to get more from an existing happy client than to win a new one. In fact, I've often seen numbers bandied around like "it's five to ten times more expensive to get new clients than to retain existing ones". OK, many accountants reading this will no doubt tell me that they don't have any client churn (another story for another article), but what about the rest of you?
When did you last spend time with each (decent) client working out how you can help them more than you do at the moment?
That might mean a coffee, listening to their wider business needs, developing your relationship with them and increasing the amount they trust you. No, I don't mean your normal (chargeable) meetings with them; but additional time. Clients want to feel important and appreciate that you take time for them.
Building and strengthening existing client relationships can help you win a bigger share of their wallet, especially when they meet other professionals who only focus on new business. It may help them trust you more so they are more prepared to listen to your advice and proposals, and it goes without saying that understanding them more will mean your proposals to them are more likely to be "value adding".
Of course, that value-adding piece may allow you to implement the third tactic and increase your fees too!
3 ideas to increase fees in your firm
- Be aware of how much time (and money) you spend on looking for new business (meetings, networking, marketing, proposal writing, on-boarding, etc). Spend the right amount on it, probably linked to a good tactical marketing plan.
- Spend some time recognising existing clients. Email them or even just "like" their social media output (and that's something you could delegate).
- Decide on the amount of time each week you can spend with existing clients. This could be meeting or just phone calls - maybe there's even a client development process to follow?
Like the driving example, give yourself the space to see the right balance. Most firms don't do this, do you?
How much of your marketing time should you devote to existing business, not new business?