Practice Management: Build Your Business Profits!

Shane Lukas shares some tops tips on how to how to take your practice from mildly successful to wildly profitable.

The dream of a wildly profitable practice that provides both financial rewards and personal freedom can seem elusive to many accountants. If you find yourself working long hours, juggling numerous clients and still not achieving your hoped for level of profitability and fulfilment, you aren’t the only one.

But you don’t have to accept this as ‘just the way it is.’ There is a proven seven step roadmap, which will help you to transform your practice from mildly successful to wildly profitable.

In this article, we’ll explore the first three steps of this roadmap, which lay the foundation for your practice’s transformation. You’ll find out how to access the remaining four steps at the end.

Understanding the challenges

It is crucial to acknowledge the common hurdles that many accountants face:

• Lack of a clear strategy: Without a defined vision and plan, it is easy to get caught in day-to-day operations without making meaningful progress toward long‑term goals.
• Competing on price: Positioning your services primarily on cost undervalues your expertise and reduces your profits.
• Accepting any client: Taking on all clients, regardless of fit, can lead to high‑maintenance relationships that drain time and resources.
• Being the bottleneck: When everything relies on you, growth stalls, stress increases and work-life balance suffers.

Neglecting your own business: Focusing solely on your clients’ needs at the expense of your own practice’s development impacts both scalability and profitability.

The result is overwork, reduced profits, strained personal relationships and a lack of enjoyment in your work. The good news is that by making fundamental changes, you can overcome these challenges and significantly boost your practice’s profitability.

The proven seven step roadmap

The roadmap to transforming your practice consists of seven comprehensive steps which address every aspect of your business. While all seven steps are essential, here we’ll focus on the first three.

Step 1: Clarity

Define your vision and goals

The first step in transforming your practice is gaining absolute clarity about what you want to achieve:

• What does ‘wildly profitable’ mean for you? Is it doubling your current revenue? And is that by increasing the average fee per client or simply increasing the client count?
• How many hours do you want to work each week? How many uninterrupted holidays would you love to take every year? What does your ideal life outside of work look like?
• Who are the clients that value your services the most and contribute significantly to your profitability?
• Which services do you want to offer? What mix of services will meet your clients’ needs while maximising your profits (and your enjoyment)?

Reverse engineer your strategy

Once you know the answers to these questions, work backwards to create a strategic plan which outlines the steps that will move you towards your goals. For example, you may need to restructure your client base so you attract more of the right type of client (i.e. those who are willing to pay for higher-value services).

Your pricing strategy is also critical. If you currently operate an hourly-based billing system, this limits both your profits and your scalability. Value-based pricing focuses on the value to the client, not how many hours the work takes. When clients can see how your services benefit their business, pricing objections fade away (more on this later).

Review your systems and processes on a regular basis. Every organisation has inefficiencies so identify where they are and look at how to improve them. Saving even a few minutes a day on a task soon builds into hours saved.

Invest in your personal and professional development

To reach new levels of profitability, it is important to keep learning and enhancing your skills. Every successful business needs marketing, sales and leadership expertise but many accountants have never studied these areas. There are thousands of books, websites and training courses to help you with these business skills.

It is also increasingly important to stay updated on the latest accounting technologies and software that can automate routine tasks.

Work with a coach

A business coach can provide a valuable external perspective and highlight blind spots in your practice. Regular check-ins ensure that you stay on track with your strategic plan.

Step 2: Positioning

Differentiate your practice

Standing out from your competitors in a way that’s relevant to your ideal clients is essential. There are many ways to differentiate your firm. Here are just a few:

• Specialise in a niche, either for a specific sector or demographic. You could also specialise in a particular type of service, such as business valuations.
• Develop a strong brand that reflects your values, expertise and the unique value you provide. Ensure that your website and social media profiles demonstrate that you deeply understand your ideal client and the benefits of working with you. Show your human side and create an emotional connection.
• Share content that’s valuable to your target market, not just a sales pitch. This could be in the form of articles for your own or others’ websites, on web.

Communicate your value proposition

Your target market won’t know how you can help them unless you tell them! Clearly articulate how your services differ from your competitors and the specific benefits of working with you. Highlight how you have helped clients to grow their business, increase revenue, reduce costs or simply how you take away the stress of running a business.

Market to your ideal clients

When asking for referrals (and make sure you do!) or networking, be clear about the kind of clients you want to work with. Make sure that your marketing speaks directly to the needs and pain points of your niche market. Use client testimonials and case studies to build credibility and trust with potential clients.

Step 3: Value

Enhance the perceived value of your services

Clients are willing to pay more when they perceive higher value. Every touchpoint on the client journey affects this perception so review every interaction you have along the way. Keep in touch regularly with prospects and clients so you stay top of mind. Newsletters, tips emails and social media posts are all effective at doing this.

Expand your service offerings

Are you giving your clients what they really want? Moving to an advisory-focused practice opens up a range of new opportunities. Can you offer strategic planning, performance benchmarking, profitability analysis, cashflow and financial forecasting or risk management? Advisory can sound scary but in fact you probably already have the skills you need to get started.

Implement value-based pricing

As mentioned above, value-based pricing puts the focus on the benefits for the client, not how long a job takes. It is helpful to bundle your services into packages that provide specific solutions to your clients’ needs. And a tiered pricing model gives you flexibility to cater to various client segments.

Leverage technology for efficiency

The range of technology available to accountants is vast. Used effectively it can free up your time to focus on higher-value services, minimise errors and ensure compliance with the latest regulations, and provide real time insights and up-to-date financial information to clients.

In conclusion

Transforming your accounting practice from mildly to wildly profitable is achievable! While the first three keys lay a solid foundation, the remaining steps are crucial. These steps look into optimising operations, further leveraging technology, enhancing team performance and creating sustainable growth systems.

Remember, success isn’t just about working harder; it’s about working smarter and making strategic choices that align with your goals. Start with the first three steps and see what a difference they make to your profitability, freedom and enjoyment.

You can find out more about the complete roadmap in The Accountants KnowHowClub (look for Your Structured Improvement Journey).

 

Author bio

Shane Lukas is Managing Director of AVN Inspiring Accountants, an acclaimed TEDx speaker and also the author of several books, Putting excellence into practice and What’s next for accountants?