Who Keeps Clients . . . And How?

Answer: Service, service, service. Cost ranks second.

by Rick Telberg
At Large

Landing a client is one thing — and not always an easy thing — but keeping a client is another.

A client is a valuable thing. In fact, Bay Street Group Research and Advisory Service estimates that three-quarters of CPAs typically keep a client at least five years. And one in three keeps clients an average of at least 10 years.

Not bad! Considering that half of the finance managers we’ve talked to wouldn’t recommend their CPA firm to their closest friends. The apparent stability of the client-auditor relationship is pretty impressive.

But the contradiction of statistics leaves us wondering whether a lot of clients wouldn’t mind hooking up with a new CPA firm. A lot of them complain about auditors who come in for the audit but never offer much else — no advice on how-to, no warnings of new accounting and taxation rules, no consultations on financial efficiency, no clues on how to run a better business.
Annie Rule, Dallas-based sole proprietor of Annie S. Rule, CPA, is among those who believe that most or all of her clients would recommend her. She’s had her clients for an average of one to five years. Her formula is as comprehensive as it is succinct: “Personal, attentive, proactive, knowledgeable service delivered in a timely manner.”

What more could a client ask for? If she walks her talk, soon she’ll have clients who go back 10 years or more.

On the other side of the bargaining table, most finance managers might agree. Under what circumstances would they actually dump their CPA firm?

They usually say, in this order:
– Poor client service
– Cost
– Bad chemistry
– Not proactive

Joe Marchbein, of Jack P. Fitter, CPA, APC, in Chesterfield, Mo., keeps clients for an average of over 10 years. He says clients want CPA firms that “fully understand their business needs, including the nature of their business operations; provide timely services with prompt return of phone calls; advise on issues that affect them, making sure there is a good business fit for all parties; assign the appropriate people/staff to do the work; and are honest at all times.”

That may seem like a lot, but if that’s what keeps clients on board for 10 years or more, that’s what has to be done — that or keep looking for new clients.

Louise Anderson, of Davis, Monk & Co. in St. Augustine, Fla., feels a little less confident about how often her clients would recommend her firm, but she knows what’s been keeping them around for an average of up to five years. “Someone to answer their questions with a yes or no!” she said, then added, “Talk to them — don’t hide behind the technical stuff.”

Measuring the longevity of accountant-client relationships is a good way to measure the effectiveness of your service. Are your relationships getting longer or shorter? What seems to be doing the trick? Is there something you should be doing more of? Or less of?

Or do you imagine in your dreams, that clients are forever?

[First published by the AICPA]

Posted at September 24, 2006
Filed Under BSG BUSINESS BUILDER |

Comments

One Response to “Who Keeps Clients . . . And How?”

  1. Charles H. Green on October 12th, 2006 3:42 am

    What a great topic.
    In my own experience consulting to professional services firms in general, professionals want to believe two things that often aren’t true.
    The first is that the client means what they say to you about satisfaction. The truth is, it’s very difficult to speak difficult truths to providers whom you have some affection for and experience with. To use another relationship metaphor, when one person breaks up with another, it’s often a shock to the break-ee. Why? Because none of us like to say, “gee, I’m not as excited by you as I once was.” Consequently we get the polite head-nod, the unequivocal murmuring. It doesn’t mean what we would like to think it means.

    The second untruth is that relationships are linear–that the gap between satisified and highly satisfied is the same as the gap between highly satisfied and delighted. The latter gap is much bigger, and qualitatively different.

    A trusted advisor relationship is to “highly satisfied” as a good French wine is to beer. Nothing wrong with the beer, but it just doesn’t cut it for a really good meal.

    The best work I’ve seen on this was in a little book called “You’re Working Too Hard to Make the Sale,” by Brooks and Travesano. They researched about 2000 medium-complexity sales interactions, and concluded two things:
    1. The client buys the salesperson not the product;
    2. People overwhelmingly prefer to buy what they need (i.e. what they have to buy anyway) from someone who knows that they want (i.e. someone who “gets” them on basic, bedrock issues–hopes, fears, wishes). More simply: we all prefer to buy our necessities from someone we feel good about personally, who we feel understands us.

    Trusted advisor relationhips, like good marriages, aren’t forever, unless you work on them. And they are not built just on needs assessments and good work; there is a personal connection there that can’t be denied.

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