Be a Small Business Financial Consultant v2

You may be asking yourself, “Why automate? I have a stable of satisfied bookkeeping clients and I have a process that works for them and for me. Why change?” We want you to consider how you can innovate your accounting services and add value to your clients while also opening the door to new clients.
Ceterus has been delivering monthly financial statements to thousands of small business entrepreneurs (SBEs) for over 13 years. The Coronavirus pandemic and resulting economic crisis have surfaced a realization that’s been building over the course of our company’s presence as an accounting solutions provider.
The Coronavirus pandemic has helped to illustrate that the most valuable thing we could end up doing for clients wouldn’t have anything to do with earning per share, fraud detection, or tax optimization. Instead, the highest value we provide to clients is serving as their “small business financial consultant.”
Until the pandemic hit, we fought that reality. We wanted our value to be consistent with our accounting training: provide good books, thoughtful analysis, and nuanced explanation of the tax code. We wanted to serve as an advisor, providing financial insight not emotional support. In part, we felt best equipped to provide good books; it seemed less practical to spend time talking to each client individually.
Clinging to that belief, we built a company, scaled teams of specialists, standardized, proceduralized, raised capital, and automated what could be automated. Ceterus now delivers books that are more accurate and timely to a range of businesses. We provide endless metrics, analytics, and reports. And while our clients love these things and get a lot of value from them, what we’ve come to understand (and what COVID-19 reinforced), is that no amount of analytics can match the value provided when a skilled accountant takes the time to listen and share advice based on their insights and experience. Particularly when those insights are based on applying that experience to the client’s data and what that means in the context of the time.
Why are we sharing this? We’ve learned that there is no good replacement for the role of small business therapist and advisor and to encourage you to embrace this role and make it your top priority. Do not view time spent providing consultation to your clients as a distraction from doing the accounting. View it as the most important thing you do in your craft. Understand that it is a long-term investment in your business. Focus on doing it well. Learn to do it better. Clear space in your calendar to make it a habit. Your clients will benefit, as will your business. And know that there are ways you can manage to do this without sacrificing any time that is related to the quality and timeliness of delivering monthly financial statements.
The time you take to focus on your small business financial consulting practice will benefit your business, and there are three very practical reasons why: Rates, Retention, and Referrals.
Price sensitivity is high for things robots can do.
Price sensitivity is low for personalized, difficult-to-replicate services delivered by humans.
The bad news is that much of the work we do as accountants is rapidly becoming automatable. Preparing tax returns, reconciling accounts, sharing financial statements, and many other functions that have traditionally been central to your practice can now be done by smart software. The automation trend is only going to accelerate, and it’s going to accelerate rapidly. Cloud technology, machine learning (ML), robotic process automation (RPA), and simple automation scripts are driving down the cost (and hence the perceived value) of this work. Automation also changes the competitive landscape for practitioners.
The good news is that robots make lousy business financial consultants. By making consulting-oriented work the foundation of your relationship with your clients, you will be better positioned to charge a rate on which you can build a profitable business. Clients cannot easily price shop the time and value they derive from you being their “partner.” When you become a part of your clients’ businesses, you are less likely to be viewed as “replaceable” and more likely to be seen as part of their process for making important decisions.
Work a robot can do is not sticky.
Quality human interaction is very sticky.
Retention is one of the most important attributes of a successful firm. We know this: the most profitable customer is the one you already have. The cost to acquire and onboard a new customer is huge. The same rationale that applies to pricing applies equally to retention.
So, bad news first. Competition is rampant within the commoditized areas of accounting. In addition to rate pressure on these services, a client’s willingness to switch providers will be high if you don’t inject a non-commodity element into your service. Large firms are merging, technology companies are entering the space, and automation and competition will only increase as time marches on.
Now, the good news. Your clients care FAR more about the financial consultation services you provide than the commoditized work. If these services come as a package, your clients will gladly pay you to do both the “robot work” and the “consultation work.” No amount of analytics can match the value provided when a skilled accountant takes the time to listen and share advice based on their insights and experience.
Referrals are the best source of growth. They are cost-effective and create high-value client relationships. Your current clients know what you do and how you do it, and those they refer are more likely to be looking for something similar.
When clients call you “my CPA,” you are more expendable. But when your clients call you “my CFO,” “my finance guy/gal,” or, “my financial consultant,” you know you’re in a good place with them. When clients view you as more of a partner, they will also talk about you more, with sincerity and affection, and be much more likely to refer you to their peers.
Like any relationship, clients react to your cues. If you seem burnt out, inconsistent with responses, and on the brink of overload, they aren’t going to refer you. Even when they love the business consultation they get from you, they will sense a limit in your capacity to serve others. They will fear that by introducing you to potential clients, this limited resource will ultimately become less available to them. The best way to avoid burnout (and the appearance of burnout) is to specialize in the financial consultation work and make the “robot” work as efficiently and as hands-off as possible.
Focus on what you can do far better than a robot ever could. When you shift from being “just” an accountant and become more of a small business financial consultant, you’ll be far more valuable to your clients and will improve your rates, retention, and referrals. Ceterus can help you achieve this value by putting our automated solution for delivering monthly financial statements to work for you and your clients.
Small Business Consulting in Action
The impact of small business consulting is real. As we said at the top, the Coronavirus pandemic and subsequent economic crisis provided our CPA partners focused on dental firms with an opportunity to perform hardcore consulting. Their clients needed financial information quickly in order to prove qualification and apply for loans as part of the Paycheck Protection Program (PPP). These clients needed to quickly understand impacts on their businesses and the changes in costs as part of managing through local shutdown requirements. They needed to quickly understand the financial impacts of complying with CDC guidelines upon reopening and model the near-term conditions and impacts for their businesses in the short-term and medium term. They needed to determine qualification for PPP forgiveness and prepare for the results one way or the other. With PPP 2 they needed to quickly determine their eligibility for a second loan based upon the requirements and their circumstances. All of these circumstances were and are time-sensitive with a premium placed on ready access to data that is organized for quick analysis and reporting. Our CPA partners leveraging the Ceterus CPA Platform have been able to advise their clients navigating the PPP process and access and present financial information to their bankers. Our partners have helped their clients understand and address impacts to their businesses based on the consistently coded and organized data in their monthly financial statements. Our partners have leveraged the benchmark information available in the Ceterus CPA Platform to help clients understand their financial position relative to other dental practices.
In short, Ceterus CPA Platform partners have been able to advise their clients as they navigate an unprecedented disruption to their businesses. And the CPA firms understand the value in automation doing its thing so the accountants can do their thing.
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