Do You Take on Every Client Who Calls?

In the beginning of your Pennsylvania accounting or CPA practice, you may take on every client you can in order to get your firm up and running. But as your practice grows, you may discover that some work or some clients are more productive or enjoyable than others. It may be time to begin to refine your client base and develop a plan to take on only the clients you want to work with.

It may seem counterintuitive to turn down work or let some clients go, but bad clients cost you more than you realize. The types of clients you may wish to cut ties with include:

• Those who consistently pay late (or not at all). These clients cost you lost revenue or cash flow problems.

• Those who are negative, complain about anything, or are rude to your staff or to you, and no one wants to work with them. These clients drain morale and cause health problems.

• Clients who don’t provide the information you need in a timely manner, then create a sense of emergency when they finally get it to you, with little time to complete the work by the deadline. These clients create inefficiencies, wasted time, and emotional and psychological stress.

• Clients in industries or lines of work that are not a good fit for your firm’s knowledge or expertise. You may have to do a lot more research on the industry to avoid costly mistakes, or you risk additional rework or audits.

• Clients who want you to fudge the numbers or are not fully straightforward regarding documentation to back up their numbers. These clients are begging for an audit, which will cost you time and potentially your professional reputation.

These trouble clients should be culled – politely – from your firm, and effort should be made to avoid bringing on other problem clients.

Your first step is to clearly understand the kinds of clients you want. What industry do you want to work in? Company size, revenue? Particular services? If you work with individuals, what kind of work do you want to do for them? What income level are you looking for?

For existing clients, evaluate how they fit into these criteria:

• whether they pay in a timely manner

• how well their information is submitted and if they are cooperative and forthcoming when you make requests or try to train them to provide accurate or timely information

• how well they interact with your staff

• what kind of services you provide them and if these are services you want to provide

• whether the client is a liability exposure

• whether the client has potential or is a drag on the company.

For a new prospect, spend 10 or 15 minutes on the phone determining if the prospect fits into the kind of clients you’re looking for. If they don’t, you can politely tell them your expertise is not a good fit for them and recommend another accountant. If they do, invite them in for an interview to discuss their needs in more detail and to determine if there is a good fit. It’s important to set this expectation, so they don’t think that the meeting is a guarantee of working together.

When you have your new client information session, evaluate to the best of your ability where this person or company would fit into the criteria you have developed for existing clients. The process is about identifying red flags right away.

It’s important to try to maintain a positive relationship with existing clients who are no longer in your best interests. As much as possible, try to make it a mutual decision. The goal is to counsel them out, not fire them.

The best thing is to invite the client into the office to discuss your relationship. If your client signed an agreement that clearly defines your expectations, review it with the client and highlight areas where the agreement has not been upheld (for example, payment within 90 days, timely delivery of required documentation, and mutually respectful behavior). If you do not have such a document, consider creating one for future clients.

Discuss with the client the difficulties that have been arising and ask, “What do you want to do? Do you see ways to resolve these issues, or would you like me to refer you to another firm that may be more of what you’re looking for?” If the person would like to stay, you may give the individual or company a timeframe, such as another business quarter, to see if the issues can be turned around.

If the issue is something that you do not foresee being resolved, such as a bad attitude, or you are not interested in the industry or the type of work you’re doing for that client, the best approach is to politely encourage a separation.

For instance, for an unpleasant client, you may say, “We have not been able to provide service to you in a manner that has satisfied you. Would you like me to give you a few names of other accountants, or would you like to do your own organic search?”

For a client whose services or industry you don’t want to do anymore, you can easily say, “After working with you for a little while, it has become clear that we are not a great fit for the work that you want us to do for you. I know another accountant who has more expertise in that field (or specializes in that service). May I give you a referral to that firm? I believe you will be very happy with them.”

The goal is to retain a good relationship with the clients you are releasing so they do not talk ill of you. It’s important to retain a good reputation. But having the kinds of clients that you want and whom you can serve well is the best way to grow your reputation as an expert in your field. Build confidence in saying no to protect your time, your team, and your reputation.