3 Strategies for Tax Preparers To Generate Year-Round Revenue
Being a tax preparer easily falls into the category of a seasonal business. There are some great benefits to this, like being able to take some time off after your busy season and having the freedom to do what you’d like. However, you’re also going to face the challenges that come with being a seasonal business, which means that when tax season ends and the cash has stopped coming in, you’re more likely to generate less revenue. Plus, you’ll likely continue to have business expenses year-round. So you’ll need to make sure you’re good with your budget to ensure you’re able to cover everything.
Now think about how much it would change your business if you could increase your revenue quarter after quarter, all year long. I bet it would make a huge difference, right?
We’ll show you how to:
- keep your cash flow going year-round
- cash in on your expertise
- add a new stream of revenue
Year-Long Cash Flow
There are 5 main things you can do to increase your income without working those dreaded additional hours.
Follow these 5 steps to increase your revenue now:
- Identify Your Ideal Client
- Who do you enjoy working with? We all have those clients that make working with them a breeze by doing things like following through on time. Take time to identify the person who is a better fit for your practice and then aim to work only with these clients going forward.
- Communicate Your Value
- The clients you already know KNOW you have what they’re looking for, and they’re ready to move forward with you because you have solutions that will solve their challenges. This is because you have effectively communicated your value to them. The way you speak at meetings and even the language on your website are ways to communicate your value to your potential clients.
- Package Your Services
- By packaging your services, you’re setting yourself up in such a way that you’ll be able to create year-long income. You can separate your fees from your time and all the forms that you may be preparing.
- Value Pricing
- By creating a value pricing strategy, you’re allowing yourself to earn more money for the same services without working additional hours. Changing to a value pricing structure makes you able to increase the value of each client.
- Consultation Mastery
- Many tax preparers are service-oriented and love doing the work, but they hate what would be considered the sales part of their job and are not as effective as they’d like to be. Learn how to have a value conversation in which you naturally invite people and create interest without an actual pitch.
Cash In On Your Expertise
The easiest way to increase your income is by looking at your existing clients. These people already know you and trust you more than someone who hasn’t worked with you before. There’s a good chance that you may be leaving money on the table with your current clients for services that you’re unaware of.
How much would it change your business if you could boost the value of your current client by 50%?
Many tax preparers make the mistake of focusing on the forms and tasks they complete and lead with the fact that they file taxes for their clients. However, when you do this, you’re making yourself be seen as more of a technician, which makes you a commodity. When someone is looking to hire you, they will compare you to everyone who offers a similar service to you. This means you will have to remain price competitive to bring in new clients. Just remember commodity = competition.
This is why advisory services are so important. After all, your intellectual property is the highest value from your client’s point of view. They choose to work with you because you have the knowledge and insights that you do. Advisory services are the one thing that can move you from being considered just a commodity. This means you don’t have to compete with price anymore because you’re leading with your expertise instead of functions and tasks.
It’s no surprise that all of your clients would love more insights. As an accounting professional, you are uniquely qualified to understand the story behind the numbers and interpret those numbers in a way where your clients can gain insight and make better future-focused decisions or create a shift in their business that would increase their profits.
There are 3 ways to bring advisory services into your business that you should consider:
- Direct means meeting with clients one at a time and doing something that is going to help them impact their business. This is the most popular advisory service to add.
- Leveraged could be something like live training for many people to consume at once. By doing this, you’re creating a leveraged income which gives you an increased earning potential than your hourly rate. You’re exponentially increasing your hourly rate since you’re serving so many people at one time.
- By creating something like a self-study program or online course available for anyone to consume on their own time, you’re creating an opportunity for passive income year-round for yourself.
New Stream of Revenue
By creating packages, you’re giving potential clients options of how to work with you instead of just the one option to work with you or not. This changes the question in their head from if they want to move forward and work with you to how they want to work with you.
When creating packages, aim to give 3 options for them to choose from instead of just 1.
- Silver Package: This is for your price-sensitive clients. This package should include basic needs and have a base price that won’t deter those with simple needs.
- Gold Package: This should be everything included with the basics and a little bit more. The majority of your potential clients should be picking this package.
- Diamond Package: This will cater to your premium clients who need additional support than your average client. This package should come with more access to you and your expertise and be priced accordingly.
Creating packages comes with certain benefits for you. Consider these 5 advantages you’ll have by taking the time to develop these packages:
- Improved Efficiency
- Packages allow you to run your business instead of having your business run you. By having more systems and processes in place creates improved efficiency.
- Up Front Fees
- Your client will know precisely the fee expected for the service they are hiring you for. There will be no surprises, additional payments or invoices that you need to chase them down for.
- Paid in Full
- Start getting paid before you do the work. Since your client knows what the package costs upfront, you won’t have to wait to invoice your client after the service has been completed and then hope they pay the invoice.
- Work Agreement
- The package also serves as a work agreement. The client knows exactly what they’re getting so if they want something additional, there will be a process in place for those out-of-scope requests.
- Better Communication
- Packages address how the client should expect to communicate with you and what your response time will be. In essence, you’re training them to be ideal clients since they know what to expect from you.
You’ll want to keep in mind a few things when you’re creating your packages and the main thing is to identify your client’s hurdles. Do that by asking these questions:
- Who is the package for?
- What specific problem does each package solve?
- How does your client benefit from this?
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