Michael Rozbruch, 2x inc 5000 winner, author, and founder of Michael Rozbruch’s Tax and Business Solutions Academy, built two successful companies and can show you how to get client testimonials for your accounting firm.

After being let go from his CFO position, Michael decided he needed to make his own way. After learning marketing from the greats, he trekked out on his own…
On this episode of Growing Your Firm Podcast, David Cristello and Michael Rozbruch go into:

1. The #1 reason a prospect will buy your product
2. How to ask and get client testimonials for your accounting firm without asking for one
3. Why you’re wrong if you think you’re in the “Professional services” or “compliance” business

ADDITIONAL LINKS

• Michael Rozbruch – Linkedin
• Michael Rozbruch’s Tax & Business Solutions Academy
• How to Implement Strategic Growth & Marketing
• Get Your Ideal Accounting Clients with a Bulls-eye approach

From Laid-off to the Inc. 5000

Michael Rozbruch built his career in accounting, laying the foundation to become CFO of a company. He felt he had achieved a major milestone in his life…until the day the company let him go.

It felt like a gut punch. He had spent well over a decade getting to this point only for it all to be taken away. Michael came to the conclusion — “I just couldn’t work for anyone, anymore.”

Right away, he brainstormed areas he could help people. As an accountant, he dealt in taxes and found again and again, many individuals would struggle with tax resolution (the act of owing back taxes).

As with any new business, the first hurdle — get new clients. Rather than rely on pure luck, Michael pored through the marketing greats: Jay Abraham, Dan Kennedy and others. He incorporated these pieces into his new tax resolution practice. The year was 1998.

His first client, to get his feet wet, was a musician who was on the hook for $42,000 with the IRS. Amazingly, Michael negotiated the amount due down to $2,500.
“It felt incredible, I literally saved his financial life.”

The practice exploded growing from nothing to $23M by 2011. In 16 years, total, the practice grossed $120M. Twice the company made the inc 5000 list of fastest growing companies.

Why Customers Buy:

Many practitioners approached Michael asking him how he did what he did. In this episode, Michael revealed the secret sauce:
Know your market inside and out.

“People will buy to get away from the pain. They buy only to get out of a painful situation.” A patient will immediately go out and get pills for a pulsing headache, but when the doctor recommends more Vitamin C, there’s less urgency.

Michael mastered matching his market with the right message. When you tap into the emotional state of your market, the message writes itself. In

Michael’s case, for his tax resolution practice, he recognized his best clients were: 39-61, divorced, self-employed, 3-5 years of unfiled returns, etc.

He understood the market completely. Whenever someone came in and didn’t fall in this category, Michael picked up the red flags the prospect wouldn’t be a great client.

Understanding your market marks the first step to a growing client base.

Another trait of his target market — they didn’t negotiate his fee. Through almost 20 years of being an entrepreneur, Michael discovered: if a prospect negotiated his fee, they never were good clients to work for. Price conscience prospects become the most “needy.”

DAVID’S TIP: If you press others on price when you shop, prospects will press you on price. It’s funny how it works.

Michael recommends: The more you position yourself in the market as the ONLY logical choice for a prospect, they will do anything to have their pain solved by you, including not negotiating your fees. You must be able to showcase your abilities.

Client testimonials work best for that.

Getting Client Testimonials for Your Accounting Firm:

Testimonials are the most powerful tools for getting new clients. Having descriptive, in-depth testimonials takes the risk off of the prospect.

To start, you must have STRONG testimonials (not weak). A weak testimonial sounds very generic: “This Firm did a great job.” That won’t sway anyone.
According to Michael, you need 3 things:

1. A Backstory: i.e. In 2007, this customer went belly up and revenues dried up. He got into a bind with payroll taxes.
2. A Before and After: Before working with Michael, we owed $42,000 to the IRS. After Michael, we only owed $2,500.
3. Understand Similar Backstories: 90% of your clients will have similar backstories. This is valuable for your marketing.

For many, asking for a testimonial can hit you like a ton of bricks and it’s uncomfortable. Clients won’t give you a testimonial if you don’t ask for it.

Now, it’s a Catch 22. You’re panicked to ask, but know it could be a breakthrough.

This next tip gets you client testimonials WITHOUT directly asking them. What’s the secret, according to Michael Rozbruch —
Client Survey Forms

This form gives clients the ability to provide positive (or negative) testimonials. Clients aren’t awkwardly being asked for them, but they still have a forum to voice their opinion.

Including in it, you can ask:

• “When did you become a client?”

• “Describe an experience that makes you happy.”

• “Was there any matter that can be improved.

• “Describe 1-2 benefits you (the client) found”

Michael’s seen so many CPAs and Partners struggle with the “entitlement” mentality. Essentially, they don’t need testimonials because, they are just so good at what they do, it doesn’t matter.

Marketing is the Business:

No matter what business you live and breathe — you are in the MARKETING business, not the business you think.

Michael introduces himself as a “marketing and sales organization that provides professional services.” You must view your company as a marketing company. Marketing is the business, deliverables are secondary.

Everyday, Michael says, you should block off time solely for marketing your company. Most firms get dragged into the “minutiae” of the day. Don’t let anything (clients, team members, etc) get in the way of the time you allot.

“If you were competing against yourself…what would you do differently to beat yourself?”

Getting client testimonials for your accounting firm kicks open the doors to your target market and prospects who need the exact help you provide.

How do you currently get client testimonials? Leave a comment below and tell us.

Related Articles:

1. How To Never Lose Your Biggest Client Ever
2. How to best present the value to your Accounting Firm client
3. How to present value pricing and advisory service to clients?

Jay Tompkins, Partner-in-Charge at MRZ CPAs, successfully implemented fixed price billing in his firm which increased efficiency 30%.

Jay recognizes the trend to move towards value pricing. For many firms, it’s a daunting task to make a complete switch. He reveals: Most firms already implement a hybrid fixed price billing system, they just don’t discuss it with their clients.

Jay will show you the steps to start increasing efficiency and profit in your firm through fixed pricing.

In this episode of Growing Your Firm Podcast, David Cristello and Jay Tompkins reveal:

1. Why the client doesn’t understand the “billable hour” and how it harms you.
2. The benefits of fixed price billing over the billable hour.
3. How to avoid those “awkward” billing questions from your clients.

ADDITIONAL LINKS:

• MRZ CPAs – Jay’s Firm
• Jay’s Linkedin Profile
• Delivering Value Driven Service and Pricing – Ed Kless (interview)
• Going into the Value Based Billing – Jason Blumer (interview)

The unprecedented growth of a firm in 3 years:

MRZ CPAs started just 3.5 years ago in late December 2012. As of 2016, they have 2 offices and working on a third, and 100 staff. How it started was a group of 18 CPAs worked under the banner of another CPA firm before splitting out and starting MRZ. Since then, the firm grew simply through organic methods.
The secret? Jay Tompkins says simply: “Being better with our communication and pricing.”

A group of CPAs branching out from a larger firm is an unprecedented move, but it’s worked for MRZ. It’s worked because the group of 18 were a strong, cohesive group.

They also had built a solid book of business who spun-off to the new firm with them.

Since Jay started with the firm, he’s managed to flip his branch from the billable hour to fixed price billing. From this, he’s increased profits, built a happier client base, and boosted efficiency by 30%.

How did he do it? First. Jay dug into the problems with the billable hour.

The problem with the billable hour:

In the compliance business, Jay believes it can be tough to directly switch over to value pricing. Unlike any sort of marketing or sales goals, compliance goals are harder to measure the monetary value. He’s seen many firms actually use a hybrid model of fixed pricing.

For many firms, they record their time. Then, when it comes to billing, they look at the time spent and compare it to what was billed the prior year. After which, they mark it up or down to get close to the prior year.

Weeks, even months, after the work is done, the bill gets sent out. Now, administrative tasks, especially bill collecting, are added to your plate.

What you need to understand is your client doesn’t understand the billable hour. When you write up or down your time and bill it, your client believes they are on a fixed price already. A true billable hour only brings conflict.

DAVID’S TIP: Billing by the hour drives my anxiety. If I drop my car off and the mechanic says, “It will be $85 an hour to fix your car. Talk later.” I feel neglected and worried about what’s going to happen.

When you bill too much to a client, they get upset. If you bill too low, you set the expectations for lower bills. On top of that, when the project goes out of scope, a client then gets billed more than what they thought the project would cost. Clients don’t like being surprised.

Making the conversion to fixed price billing:

The easiest step to start your venture into fixed price billing is working on price upfront with the customer. A typical firm gets a new client, looks at their prior year tax return, and then ushers the client out. Discuss with the client the different things they remember the last CPA needed. What problems and snags came up?

What did the client not like?

Doing this allows you to narrow down the scope to then provide a pricing structure. Narrowing the scope then gives you the option to add additional services to the scope for increased cost.

“Just because the industry has done it this way forever, doesn’t mean you have to do it.”

– Jay Tompkins

Jay found most clients will pay more for the predictability of fixed pricing. Again, it boils down to the conversation you have upfront with the client. Your client wants it to be simple for them to understand. Add on top, you can bill them each month by taking the full price of the engagement and dividing by 12. Now, you’ve built predictability of revenue into your business.

This is unlike most firms where you bill it all at once, then the client waits 6 months to pay thus bringing cashflow problems into the firm.

These conversations upfront make it easy to come back to the client and say, “We are going to need to add on additional services. If we do it, it’s $X, or you can do it.”

Most of the time, the client will just pay the extra for you to do it. Having the payments spread out over months makes it predictable payments for them as well.

Now, you’ve removed Accounts Receivable and the awkward conversations explaining to clients why their bill was what it was.

Closing ideas:

Jay believes making this transition is all a mindset. Realize your firm can be better and more profitable. Have the mindset of wanting to make it easier for your client and they will pay an added premium for this.

Discuss internally on the best ways to make the switch and get everyone on board. Next, figure out — Who should we begin switching to fixed? It’s easiest to do so with new clients. There aren’t any preconceived notions.

The best time to roll out to old clients is around Fall. When you send out next year’s engagement letters, open the conversation to these clients. Older clients require a more “long sit-down” approach. You could lose a small percentage of clients making the switch, but remember, it’s for the good of the firm.

This firm will continue to accelerate growth due to implementing these new ways to run the firm. Where do you want your firm to go?

Related Articles:

1. How to Ditch Timesheets, Innovate Quickly, and Grow a Successful Accounting Practice
2. Double Your Bookkeeping Revenue by Cutting 30% of Your Clients & How to Hire the Perfect Partners [Case Study]
3. 4 Surprising (and Creative) Ways To Motivate Your Accounting Staff