Your worst enemy?

On Sunday I spent a CPD day with some fellow CIMA accountants who, like me, have their own businesses (or aspire to have their own businesses).

As with many business owners one of their key problems is a lack of confidence, not in their abilities as accountants, but in determining the value they bring to their clients. This leads to them taking on work which is below their qualifications and experience, because it is easier to ‘sell’ lower level work if you don’t understand the value to clients of more challenging projects.

It is then very easy to get onto the tread mill of having to take on lots of low value clients/projects just to pay the bills. Because all their time is taken up servicing clients, rather than developing their business, they don’t have time to go after higher value work. This then means they find it very difficult to break out of the rut they have dug for themselves.

Another problem is that, even if they are trying to go after higher level projects, they are not clear enough on what their ‘perfect’ client looks like. To the ‘perfect’ client the work professionals can do for them is of real value. They want the service and are prepared to pay an appropriate fee for it.

Other clients may have been told they need the service but it has less value to them because they do not get why it is important to them. These clients will view a professional’s fees as a cost and are much more likely to want the service at a cut down fee. In this situation the management accountant (in this scenario) may still be in the position of doing a large number of hours for a relatively low rate and have the same problem as detailed above.

They have become their own worst enemy!

The key to understanding the value you can bring to customers is to talk to them! I know this sounds obvious but we are often put off from talking to our clients because we are afraid they will tell us something we don’t want to hear. However, it is more likely they will tell us something we DO want to hear!

If you don’t have any ‘perfect’ clients you will still have introducers and other business professionals with whom you can talk to chrystalise your value proposition.

Although this blog has focused largely on accountants the same problems can be found with other professional service providers and the solutions are the same:

– Have confidence in yourself and your abilities

– Understand the value your clients realise from what you do and charge accordingly

– Concentrate on projects in which you have particular expertise

– Identify your perfect clients and market to them

Become your best friend and give yourself the best chance of running the business you deserve

Fiona 🙂

Planning to retire?

How many of us know what our business needs to achieve to deliver against our personal goals in the long term?

We all know that the state pension will be unlikely to meet our retirement needs in full. Most of us will be looking for our businesses to provide a safety net of income/capital value to make sure our retirements are secure.

However, as Steven Covey says you have to start with the end in mind. This means that you have to plan NOW to ensure you get out of your business what you need for the future.

If, like me, your business is largely centred on you as an individual your business is unlikely to be worth very much to someone else when you decide to stop. This means that your business needs to earn enough for you to make decent pension contributions now to fund your retirement.

If your business employs other people to deliver the product/service then you may be able to sell your business to realise value when you retire. However, you can only maximise this value if you start to plan several years ahead. It is vital that you can distance yourself from the business and that it can run without you, for example.

Whatever your goals it is never too early to start positioning your business so it is in the best position to meet them. If you don’t, you may find your retirement dreams end in cash strapped nightmares.

Fiona 🙂

Delegate or die

I was talking to a business contact yesterday –  he is successful in this field but  is starting to get bogged down in the day to day running of his business. In particular, administration and bookkeeping (which he and his wife do between them) are starting to grind and take the shine out of their enjoyment of their businesses.

This is a common story but one that has a simple solution – DELEGATION.

We may have many ‘good’ reasons why delegation is hard and why we should do all the ‘easy’ jobs in our businesses:

– it can be expensive to pay someone else

– perhaps they will do the job wrongly or prove unreliable

– it will take time for them to settle in and the process will be distracting

However, you cannot escape the truth that however much you try to ‘create’ time by managing it better, there will only ever be 24 hours in a day! There will come a point (or you may already be there) where there is simply not enough time to do all that is needed in your business. 

So I would answer each of the objections above like this:

– You are much more valuable to your business than you may credit. Your time is likely to be worth much more to your business per hour than the £15-£20 per hour you might need to pay an administrator/bookkeeper. 

Also there are jobs which only you can do in your business. These undelegatable jobs include creating business strategy, and leading and managing your business (even if  you work alone your business needs to be managed!). If administration and bookkeeping are keeping you so occupied you do not have time for strategy, or management, then your business will suffer considerably.

– Are you really sure you are the best bookkeeper/administrator anyway! Surely you did not start your own business to play around with the books or to file!

– If you engage a trained bookkeeper they will settle in very quickly. Also, because they already know what to do as a bookkeeper you won’t  have to spend time showing them what to do.

So do yourself a favour. If you have too little time to do the important things in your business – DELEGATE!

Fiona 🙂