I hope our last conversation about the client experience inspires you to examine every interaction you have with your clients. How does the experience you offer now make them feel? What could you do better or make easier? Because your report isn’t the only deliverable you are being judged on.
On to this week. Increasing revenue feels complicated, doesn’t it? It feels complicated because we make it complicated. Not the end result so much, but how to actually go about it. Because in reality, any Business 101 course will tell us the ways/rules of increasing revenue are few and simple. (Executing, however, is another matter.)
And if you’re new here, welcome aboard. This is what we do!
The risks we take define who we become.
The “right time” to take a risk is something we create, not something we wait on.
What risk do you need to create in/with your practice?
That’s right … let’s dial it up!
Almost all of my coaching clients seek me out because they want more clients.
Because more clients = more revenue.
And if you’re stuck in “Survival” or “Stability” mode, you probably believe more revenue is the key to solving (all of) your problems.
For today, let’s assume that is true.
How do we increase revenue?
There are only 3 ways … 3.
#1 – Land more clients
We are already selling and delivering services that others value.
Chances are, other people want and need those services, too.
The challenge: We’ve got to find more of those people … or help them find us.
Here’s a thought.
Start with the clients we already serve and work backward. Ask them: How did they find us? Why did they hire us? Were they happy with our work? Do they recommend us to others?
These questions get at the heart of it all, don’t they?
And the answers give us a roadmap to land more clients.
At the end of the day, recognize that people hire us when they need our services – not when we need their business. And at any given time, only a small percentage of the universe needs our services – even if we are the best at what we do.
#2 – Raise your fees
Possible … yes. A little/lot scary … double yes.
The challenge: We say we can’t raise our fees because there is already downward pressure on them. And clients can easily find someone else to do the work. (If that is true for you, you have a bigger challenge.)
Back in my local firm tax department days, we went to an annual 1040-update program called Gear Up. Each year, one of the speakers would close by saying, “And for heaven’s sake, double your fees. If half of your clients leave, you’ll still earn the same revenue but with a lot less work. And the reality is that half of your client won’t leave.”
Yes, the thought of raising our fees is scary.
Maybe we can’t do it now because [fill in our story].
But for today, just recognize that raising your rates is another way to increase revenue.
And parenthetically, either our newest research and reference resources are making us more efficient and effective so we can complete an engagement in less time than it used to take … or they are not. But if true, fees are not being compressed and we should be making an equivalent rate per engagement.
Example: $15,000 to complete a valuation that use to take 60 hours = $10,000 to complete a valuation that now only takes 40 hours.
#3 – Sell more services to the clients you land
You are already working with clients.
You have started filling their know, like, and trust buckets.
Clients in this stage of the relationship are likely to buy additional services – either those you can provide directly or in partnership with another service provider – if those services solve a problem, make their businesses more valuable, and/or yield a high ROI.
The challenge: If we are not good selling our primary services, we are even worse at selling ancillary services (which may actually have greater value to the client).
One of the biggest regrets I have is all the money I left on the table after delivering a tax purpose valuation report. Amy (my wife and business partner for readers who are new here) and I got so busy doing this work, we never stopped to think about the bird in the hand to whom we could sell other services.
Would we have been successful in every case? Of course not. But we likely would have been successful in many cases … and that would have added up to some serious coin (revenue).
So is there a “best” way to increase practice revenue?
All three ways come with a challenge.
Successful practices overcome those challenges. They have a steady stream of new clients calling, are charging fair prices, and work to add value for their clients by solving or heading off other problems.
But to get momentum, start with the way that seems easiest to you. Work to attract new clients, raise your fees as you add more value, and pay attention to current clients in order to identify and solve the problems hindering their success.
In real life
In my experience – and maybe yours is different – most of our BVFLS work is once-and-done. We have a single transactional relationship with a client, and when the transaction is done so is the relationship (not including the possibility of future referrals from that client).
As a result:
- We are always on the hunt for new clients to replace the ones that drop off.
- It’s hard to raise fees for new clients when they don’t have a history of working with us and experiencing the value we deliver.
- There is a mindset shift required to sell additional services, from a shorter-term transactional relationship to a longer-term transformational one.
And to the point of my last post on the client experience, who are your clients? Are they referral source attorneys or their clients? Or both?
My advice … segment each client-audience and develop strategies and tactics for the three ways of increasing practice revenues where they apply.
For example, you could land more referral source as clients.
As the referral sources gain a history of working with you, you can raise your fees and they’ll tell their clients that you’re worth it.
And when you capture the attention of a client of a referral source, watch for the opportunities to sell them additional services.
– If you like what I write about, tell a colleague.
– If something resonates and you want to reach out directly, email me.
– If you think we share common interests, connect with me on LinkedIn.
– If you want a sense of how well your practice is working for you, take this Practice Self Assessment.