Joey Brannon, Founder of the Consulting CPA, sold the tax and accounting arm of his accounting firm to jettison into solely a consulting profit center.

Most firms “rest on their laurels” and stay in their comfort zone with just doing compliance work and keeping clients at an “arm’s length.” Joey saw the opportunity to move from a technical relationship to a practical relationship with clients. [More on that below.]
In this episode of Growing Your Firm Podcast, David Cristello and Joey Brannon delve into:

  • All the pieces you need in your client’s CRM profile (you’re probably missing a few)
  • How a consulting engagement will look like with your clients
  • Why it is as important as ever to get this started in your accounting firm


Transitioning from “normal” accounting firm into a “consulting” firm

Joey Brannon started out with a normal accounting background. He was a tax manager at a firm, controller at another company and in the normal accounting routine.
As time progressed, and technology advanced (QuickBooks integration as an example) he saw a trend forming. Because, up to that time, firms laser focused their efforts on compliance work and getting compliance clients.

Joey was on the front lines in terms of seeing how the processes of tax and bookkeeping meshed with the business operations of a client. Because accountants see the entire operation and financial picture, they are in the best spot to help from a strategic standpoint.

Joey, at the time gunning for a partner position at the firm, approached with ideas on implementing a more “consulting” branch of the firm. It wasn’t met well and it was time, Joey decided, to strike out on his own.

Purchasing a list of clients with a note over a few years, a 6-month old baby and a stay-at-home wife, Joey launched Axiom CPA as a compliance and consulting firm for businesses.
Fast forwarding 7 years, Joey felt businesses needed more his consulting arm rather than just compliance. He sold the compliance side and continued on as a business consultant.

What to have in your client’s CRM file

What many accounting firms lacked was simply the understanding of how powerful the information they have on their clients is. Again, you see the complete picture of a client’s business — what’s working and not working.

It all starts with the initial and ongoing conversations you proactively create with your clients. For many firms, they maintain a CRM file with quick facts on names of spouse and children, plus type of business. Very basic stuff.

If you plan on building a wildly profitable consulting profit center, you need to include more pieces. The most important ones being:

  • What are your client’s goals? What are they planning on the business side for the coming 1-3 years?
  • What went well in the past year that you can’t see on the tax return?
  • What is critical to the success of your business? (could be a certain person, a specific vendor or customer, etc.)

As you can imagine, these all come from an ACTUAL CONVERSATION you have with your client. Guessing these pieces doesn’t help at all.

Most clients will not bring these questions to you…a consultative firm is proactive…” – Joey Brannon

Joey recommends setting up face to face chats with your clients to get maximum results with this step. Even better, take a few days. Walk in the client’s shoes. See where trouble spots are. Discover where they need help and bring it up with them.

DAVID’S TIP: Tell your client “Let’s grab lunch and discuss A,B,C,D. The client will instantly be intrigued and interested you took this proactive approach.

Setting up the engagement for a consulting profit center

The steps to getting a consulting profit center set up isn’t tough at all. With any consulting, the profit margin (as it’s a service) is mega-high. There’s little set-up except getting in front of your clients and presenting the service.
It might be easiest to start with a client you know and trust well to kick it off. That way, you can iron out the kinks in your sales delivery and implementation.
Steps to set up a consulting profit center:

  • Set a minimal access price: This is the rock bottom price (per month) you will do a consulting engagement with a client. This keeps you from wavering, plus it shows the client you are serious.
  • Start with due diligence: This step typically is unpaid. Here you will be collecting information on the business, interviewing the owners, finding the trouble spots you can help with. Here, gather: Financial statements, key relationships, organizational chart, when did they last increase prices, competitors etc.
  • Understand the type of client: The more the client wants to grow, the more you can help. If they are fairly comfortable where they are, it will be tough to sell them as well as implement for them.
  • Start the conversation light: Open up with a discussion of their business over coffee. Keep it fairly casual.
  • Give them three options to work with: You can make it — project based. You could have an offsite retreat where you spend a few days helping, consulting and implementing. Or, agree to come back weekly/bi-weekly to implement systems, etc.
  • Position your price correctly: Most likely, you will get push-back on price. Stay solid. Say: “Yes, it is an obscene amount of money you will pay, but you’ll get a ridiculous amount of return on that.” Position the fee as much smaller than the ROI.

After this, it’s setting up the systems in place, using the expertise you’ve garnered over the years, and making massive profits.

Why it’s as important than ever to get this started in your accounting firm

Your expertise in the industry plus working with multiple clients gives you knowledge many would happily pay for. Your knowledge is a skill set the client doesn’t have on payroll.
Joey spots many firms “holding clients at arm’s length” as they want to remain independent and professional. Clients, nowadays, aren’t looking for that. They want — they need— guidance and expertise.

You might be worried because consulting might sound like having to be a “know-it-all.” That’s not it. Clients don’t expect you to have every answer. They simply want your expert opinion on the steps to take.

Moving from just a transactional relationship into a more personal one spells dividends and long-term clients for your firm.

Now, more than ever, clients will pay handsomely for consulting and your expertise. Build out a consulting profit center starting this year and see how your bottom line inflates.

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