Accountants: Would YOU buy your own business advisory services?
I was consulting to an accounting firm the other day about how they can sell more of their business advisory services to their existing clients, and also to new clients as they come through.
The firm has strong skills in delivering business advisory such as Virtual/External Chief Financial Officer (CFO) services, but they don’t currently provide this service to many of their clients.
This is an all-too common scenario for accounting firms who want to—and due to external factors affecting the accounting profession—are now forced to enter the value-add advisory space.
But selling advisory services can seem challenging
But we know from looking at the benchmarking data from studies such as The Good, The Bad and the Ugly by Business Fitness, that ninety per cent of firms are still struggling to market and sell their advisory services.
As the saying goes, ‘Plenty of advisors can do the engagement. Far fewer can get the engagement.’
That’s because your advisory services are optional for your clients. This means—and sorry to always have to break this saddening news to accountants on this front—these services need to be sold.
So does the process start with signing up for the latest business advisory app? After all, there are plenty of software providers and coaches promising that if you just sign up to their business analytics app that your accounting and business advisory business will grow on auto-pilot.
Wow. That’s either a barefaced lie, or those providers are extremely naïve.
The world doesn’t work like that.
Software is just a tool, and until you learn how to use the tool effectively, it’s just an expense. In and of itself a tool such as a business advisory app achieves nothing, unless you also wrap two more things around it.
So is it about learning selling skills? Sales tactics? A professional selling or needs analysis process?
Well, the skills matter, and they are able to be learned by anyone willing to invest the time—we teach accountants and advisors how to market and how to sell—but even selling skills won’t help you and your business advisory team to sell more business advisory and management accounting services until you go upstream and make a shift in the most important element.
You need to regularly meet, speak with and learn about your clients
Which brings me back to my story about the firm I was consulting to the other day…
As I asked them about their advisory services, they shared that they were doing annual reviews with most—but not all—of their clients. They had felt it was a hard slog just getting this far.
I explained that, in my view, there’s not a true advisor-client relationship if there’s only one main conversation per year. There’s no client intimacy. They don’t really know you, and you don’t really know them.
The idea of getting a majority of their business clients onto quarterly or, ideally, monthly management accounting, reporting and accountability conversations—which we routinely teach firms how to achieve, such as ADVISE Accountants who told me last week that they have added $100,000 in Monthly Recurring Revenue (MRR) just on the advisory side of their regional accounting firm (yes, $1.2M p.a. in additional advisory fees since getting advice from PARADOX)—seemed like a mountain to climb for them.
I could sense it in the advisors’ tone and in their energy. They felt like it was ‘a very big ask’ to get their small and medium sized businesses to sign up for monthly or even quarterly CFO services. As I asked them more questions about how many clients they had on monthly and quarterly CFO services, and how many they had approached and invited, and what the response and success rate was, I started to notice phrases from them like:
- It’s a big ask [to get a small business owner to pay for these additional services]
- It’s a massive step up for them
- They just don’t see the value in it
- It’s a lot of money for many of them
- They’re not used to spending that much money on their accounting fees
And this jumped out to me to confirm once again that the number one aspect to shift in this—and any—accounting firm that wants to move into doing more advisory work—and that is upstream from both skills and systems/tools—is mindset.
And then I had a flashback…
Progress requires a shift in mindset
Back in the early 1990’s one of the businesses I was consulting to in relation to its marketing and sales processes was a management consultant that specialised in helping retail jewellery stores. They had developed some very good software—it was truly pioneering back in its day—that allowed the jewellery store owners and managers to track their inventory in analytic detail, see which products lines were moving well, which were slow, where the profit margins were good, which sales people were selling which product lines, and vice versa.
The software gave excellent insights into many of the drivers of the business’ performance. But like any piece of management software, the value comes from the accountability conversations that flow from the data, not from the data itself.
My client shared this story with me that has stayed with me ever since—25 years on—and was the catalyst for me to adopt the Mindset > Skills > Systems change management model in my consulting toolkit ever since. I’ll quote him (from memory!)…
I was in a store the other day talking to a client who wanted to sell more of their luxury watch lines. These are good products and the profit margins are obviously excellent. When I looked into the data I could see that two of their three sales assistants were regularly selling 10 or so of these watches each, every week. But one of the sales assistants was barely selling any of them.
I thought, interesting… I wonder what’s happening here? Perhaps this team member needs some more training in the product knowledge about the watches, or perhaps also in retail selling techniques? So I had a chat with him one-on-one to ask him about this, just casually over a coffee.
When I asked him about the luxury watch lines and the store’s goal of selling more of them each week, he said, “Oh, they’re impossible to sell.” I asked him what he meant by that. He said, “Who on earth would ever want to buy one of those?” Again, I asked him what he meant by that.
He then said, “Well, they are ridiculously expensive. Who would ever spend that much money on a watch?!” And he said that with a firm conviction.
I asked him, “So you’re not selling many of these watches then?” He admitted, “One or two ever, I think. Some rich people occasionally just come in and want one.”
I then shared with him, “Do you know that Sandra and Kelly sell about ten of the luxury watches each week?” His jaw dropped in disbelief. You could see in his eyes he was thinking, “What the…? That cannot possibly be!”
So I showed him the data and he could see for himself. He sat back in his chair and said, “Wow. Really? How?”
I then explained to him that while he thought the watches were expensive, that ‘expensive’ is a relative term. To many high income earners who value quality and prestige, the prices are a reasonable percentage of their income. I also explained that he was unwittingly applying his values, perceptions and beliefs to the customers, rather than asking them questions and finding out what they value in a watch.
It got him thinking. I then had a conversation with him and the other two sales assistants, so they could share their views and how they talk with customers about the watches. In short, how they managed to sell 10 luxury watches each per week.
That whole process shifting his thinking. That was a few weeks ago now, and his sales of the luxury watches are now steadily climbing and are on track to be similar to the other two sales assistants.
It was all about his mindset.
Likewise, with this accounting and advisory firms, their first shift needs to be with their mindset. I sense that they are like this retail jewellery sales assistant, at the stage where he thought the watches were ‘expensive’.
Expensive? Compared with what?
Whenever you hear an objection in your sales process of, “Gee, it’s a lot of money,” that shows you haven’t pre-empted that objection earlier, by framing that up with, “Compared with what?”
Is $5,000 a month for CFO services, ‘expensive’?
Well, compared with what?
Is $2,000 a month for CFO services expensive
Again, compared with what?
Compared with a small business or medium business operator being faced with:
- Having to hire an in-house accounts person and/or Financial Controller or CFO,
- Having to know how to screen candidates for competency in the first place,
- Having no idea whether their in-house person is actually any good and what they do and up-to-date with best practices, and
- Having the stress of not knowing whether the business is 100% compliant with everything they need to be on top of (if their in-house person is not competent)…
… then $2,000 a month for Virtual CFO services is a no-brainer because not only does it cost the client less than hiring a person directly, the client gets to tap into the experience of your entire team at various levels—from bookkeeping functions, through to accounting for the management reporting, to CFO-level expertise in the advice and accountability conversations.
They won’t get that from one in-house accounts person.
A shift in mindset will help your firm sell more advisory services
And until every advisor that is marketing, selling and delivering your firm’s advisory services believes this to their very core, your firm will not sell many clients on your services such as CFO-level support and advice.
I know that—at this stage—the accounting firm I’m advising has accountants who would not buy their own services. Just like the retail sales assistant, they’re still in the, “Who would want to spend that much money on their accounting fees?” stage.
Mindset can be shifted.
The best way is through conversation and sharing of stories where your advisors can see the evidence—the social proof—of others who are succeeding in selling and delivering the value to clients.
Get your and your advisory team’s mindset right, then you can learn the skills and make best use of the tools.
What have been your experiences, successes and challenges in selling your business advisory services? Share in the comments area below. I’ll reply to every comment.