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Build a Tax Business by Firing Your Current Clients

How to build a tax business 101: so I had this client, a very attractive woman. I don’t mean that just in the sense of how she was born. She would always dress up, look really nice, wear the right clothes, good hair. She lives in Miami where I’m from. I’m actually in Atlanta today for an event.  I met her and I sat down and had this call with her, and I started going through her business. 

Sometimes you talk to someone and they look the part right. They look like they’re crushing it. They look like they’re doing well, but once you talk to them, you kind of take the mask off and uncover what’s really going on for them.

So, I spoke to this woman, she had 5,000, 1040 clients. She was doing a million a year in sales. The the problem is they were all individual tax returns. So 5,000 1040 clients, and you can do the math on the average. Not good. She had 25 or 26 employees, on a million in sales. It’s insane. What she paid herself in terms of her salary and net profit, she wasn’t even making a million a year. Sorry, a hundred thousand a year. Totally the wrong way to get to a million because you’re not even making a hundred thousand.

One of the things a lot of people don’t understand is you’ve got to look at the clients that you currently have…to look at who’s paying the most? Look at the top five, the top 10,  the top 20… how do you get more of those? If you have clients that are paying let’s say $500 for basic tax prep. You get one client that goes through, does a tax plan, does tax preparation, does monthly accounting, does controller or CFO services, does wealth management. That client pays you $20,000 right? For $20,000 you literally can get rid of 40 of those tax prep clients. You could replace 40 tax prep clients to get one client at that level. So I find it funny, I was at this event and I’m listening to these guys talking about marketing and talking about how to grow their business, and they’re trying to get more customers, they’re trying to get more clients, but they’re not really trying to get the right type of client.

One of the main things that we do is we try to specifically identify who you want to work with that’s going to be able to pay.  Who’s going to be able to pay $10,000 a year, $20,000 a year, $30,000 a year, $50,000 a year between multiple services to get you the highest lifetime value of the client? How do we get as few of those as possible to get a million in sales? You might have 30 clients, if they pay $30k a year, or you might have 50 clients if they pay $20k a year. So I might try to have 50 clients at $20k a year, then have 5,000 clients at a couple of hundred bucks. To build a tax business, don’t keep your prices low and get more clients. 

People are coming in, they’re just coming in drilling 1040s down the gullet of this business. You’ve got to set minimum on an individual return, especially if you’ve got too much work coming in. Set a minimum of $750 on an individual return, $2000 on a business return. If you see somebody that has a business or a schedule C, plop an hour, even during the tax season, sit down with them for an hour, do an assessment, charging for the tax plan. Tell them, “Hey, we’re going to do this tax plan.”  You can even extend them so you file a little bit later.

You can work on them in May, even for the 2019 return and finish the tax plan in May. So many times during tax season, people just say I’ve got to get clients coming in, right? But this is the best time because there’s such overwhelming demand for you to really sit back and set your pricing. There’s that fever going on and the fastest way to fire 10, 20, or 30 clients is just to land two good ones.  All of a sudden you believe it.

So if you’ve never been able to charge those kind of prices, if you never been able to charge $5,000 or $10,000  for a tax plan, $20,000 or $30,000 for a client, you need to. If you ever want to build a tax business the way you want to, stop charging so low. Hit the application below and let’s talk.  

It’ll be 60 or 90 minutes and we’ll go through and show you every single thing that we do to basically acquire leads and appointments and convert those. We have a deck presentation. We show the client the value, get them to see that working with us is an investment. There’s an actual ROI if you are actually offering value. If you’re not, we’ll teach you how to do that too. But I would say an investment with an ROI. And then we’ll show you how to get that client onboard, deliver the value, and get them to pay more every single year. So I put the application below and I will see you on the other side.

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AccountingTax.com by Andrew Argue is now Corvee