There is lots of advice these days for practice owners to avoid being positioned as commodities – but there is very little assistance on how to actually make this transition, when it is needed!
Often, we are in the position where we are approached by a client who at least on the surface just wants a quote on how much it will cost to prepare his business and personal returns. In that situation, we are being approached as a commodity. If, apart from wanting some free advice, no other questions are asked of us, except for the fee, then that is the classic approach of someone who views us as a commodity. A commodity is a product or service that the customer believes he can get from anyone, so his focus is on price, not the quality of the service that will be delivered.
A good example of this, in an unrelated industry – even if on a much smaller scale, is – cellphones. I know personally that I’ve switched from one carrier to another even though the monthly cost doubled, in order to get better internet coverage.
The last thing we want to be seen as – is a commodity. The way to not be seen as such, lies in the questions asked at the initial consultation. Many already do a great job on this of course. The person asking the questions, is the one in control of the conversation. So, getting key questions answered will direct the client to look at value and take their mind of pure cost. I have seen many prospects pay as much as three times what they paid their previous accountant, when they saw value in doing so.
A structured approach to each new client complimentary consultation is recommended. Some examples of key questions to ask in this approach are:
- What did you like most about your previous CPA/EA?
- What did you dislike about your previous CPA/EA? or What part of the service that you received from your previous CPA/EA would you like to have seen improved?
- What’s most important to you about the tax (or other) advice that you get from your CPA/EA?
- What do you value most about working with a CPA/EA?
- How would you like to see your business benefit, from the work we do for you?
You may not need to ask all of these questions of course, but they are some examples of the many different types of questions that can be asked. They are designed to steer the conversation away from price and towards the value that the client stands to gain, by working with you.
For more information on how to build value in the initial consultation and how to structure your fees, contact Ciara MacMahon, of Phase Two Management.