Wednesday, September 24, 2008

Revenue Enhancement Innovation

I am proud to brag about one of my clients, Wall, Einhorn & Chernitzer, P.C., winners (for the second year in a row) of a Practice Innovation Award sponsored by Practical Accountant. Wall, Einhorn & Chernitzer, P.C. formed its Revenue Enhancement Committee (REC) about 18 months ago to focus client retention and acceptance, and on pricing. The REC meets monthly as well as communicates via e-mail between meetings.

Activities of the REC include:
· Establishing client acceptance criteria.
· Strategizing pricing options for clients and new business prospects.
· Evaluating the lowest realization clients (largest write-offs) for each partner and manager and brainstorming ideas to improve work efficiency and job profitability.
· Developing a Client Evaluation Form (and process) for use by managers to identify problem clients and solutions.
· Reviewing WIP adjustments.

The REC’s efforts have resulted in 10% improvement in realization. This is attributable to many factors initiated by the REC including better pricing, more discussions with clients regarding preparation they can complete to make our work more efficient, more up front discussions with clients about fees, and better management of fees incurred while work is ongoing.

The benefits of the REC’s efforts also include:
· More input from managers on client billing and about clients, in general.
· Many procedural features that improved WEC’s own quality control.
· Identifying additional service opportunities that were communicated to clients resulting in better client service and extra fees.

What I've learned so far is that marketing plays a role in enhancing a CPA firm's revenue. Understand how your firm works and how it makes money. Know your firm's client base. Assist your firm's partners and managers with revenue-enhancing ideas and implementation.

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Tuesday, September 9, 2008

"Your call is very important to us ..."

I recently received an e-mail to renew my online subscription to a well known greeting card company. Since I didn't use it very much (I still like to buy cards in a store and mail them) I decided to cancel my subscription. They didn't make it easy.
  1. I couldn't cancel online. I had to call the company. If I didn't call my subscription would automatically be renewed.
  2. I was placed on hold for nearly eight minutes and had to endure their on hold messages: "Never miss an occasion ...," "Ask about our print and mail option," and the popular favorite, "Your call is very important to us and will be answered in the order it was received."
  3. When a company representative finally came on the line I was offered a free 90-day extension to my subscription. Of course, I declined because I'd only to have to go through this miserable experience again - if I remembered to cancel it in the first place. This is where the sneeky automatic renewal comes into play.

What I've learned so far is that client service is vital to the success of a business. This experience was quite annoying and left me with negative feelings about this company. How do your clients rate your firm's client service? When was the last time you reviewed the processes your firm has in place regarding client contact?

Monday, September 8, 2008

John McEnroe Fires His Accountants

Tennis legend and insightful sportscaster John McEnroe recently fired his accountants (“John McEnroe Is Still Pretty Complicated,” The New York Times Magazine, August 24, 2008) “only after his former numbers men of 10 years ‘dropped the ball’ several times.” Known for his high expectations and “You can’t be serious!” attitude, I find it interesting that he endured several mistakes before making the change. What I've learned so far is that client retention is an important business strategy. How many dissatisfied clients are hiding in your client list? What are you doing about it?