TFYW#039 Advisory Services Playbook

Jun 9, 2023

I spoke to a small group of accounting firm owners yesterday in Ocean City, Maryland.

This week, I am going to recap a few of the highlights.

But first –

Today’s Tactic

If jumping into Advisory has been on your mind, your current client list may be a source for finding those first few advisory clients.

Remember, though, that selling advisory services to compliance clients is hard.

All advisory clients are compliance clients, but not all compliance clients are advisory clients.

Say that five times fast.

The best way to determine if a compliance client could be an advisory client is by asking:

  1. What do you want from your business in the next five years?
  2. Do you have the competence, capacity and capital to get there?
  3. How would your life be different if you reached that goal?

Clients without a vision will never be advisory clients.

  • They won’t have the drive to do what is needed.

Clients without a sense of their blind spots will never be advisory clients.

  •  They won’t recognize that they need help and won’t make the financial investment.

Clients that cannot make the emotional connection will never be advisory clients.

  •  It won’t be personal for them, and they won’t make the mental investment.

If you don’t remember anything else from this week’s newsletter, remember this:

The success of your advisory services depends more on WHO your clients are and less on what you do.

Advisory Services Playbook

I spoke to the Maryland Society of Accountants and Tax Professionals for three hours yesterday.

1.5 hours on a panel about small firm pricing and 1.5 hours about advisory service.

Here is the highlight reel for you:

Big Opportunities In Advisory

Source: Monadnock Research LLC

The largest firms in the world have found their growth over the last 12 years in advisory services.

Competition and technology are squeezing compliance work. High profit service growth is only available through advisory.

Source: Accountancy Age

We Are The Barrier

Many of us are stuck trying to offer advisory services similar to compliance services. See the TFYW #22 newsletter for a deeper dive on this.

Compliance is delivered by understanding tax law + past events.

Advisory is delivered by understanding your client’s business constraints + future goals.

Advisory requires a change in you and how you see yourself and your services

Without investing in you and your firm, it will be hard to create a scalable advisory offering.

The best investments (in this order) are:

Changing your mindset. Get around people who think differently from you. Read books. Listen to podcasts.

Picking a Market Position. Pick and commit to a niche. The Riches are in the Niches

Creating your Proposition. Learn how to communicate your client’s outcomes, not your services.


Three Main Advisory Offerings

Maintenance Advisory – This service requires low to moderate expertise. These are services that are easily attached to our compliance work: Cash flow forecasting, Budgeting etc.

Cash Flow Example: we monitor cash flow. We tell the client what is coming down the pipeline.

Project Advisory – This service requires moderate to high expertise.

These are ad hoc that improve a system, qualify for tax credits (think R+D or ERC) or implement new technology.

Cash Flow Example: we improve cash flow. We improve how cash is collected or managed.

Strategic Advisory – This service requires high expertise. This is longer-term support for strategic growth or turnaround advisory.

Cash Flow Example: we increase cash flow. We help unlock increased revenue or profit long term.

Finding Audiences

Selling advisory services requires a higher level of trust from clients.

The needed trust is why the advisory sales cycle is longer than a compliance sales cycle.

We can shortcut the sale cycles by finding and leveraging the audiences of prospective clients.

Our ideal clients are already congregating in audiences. They are gathered online as followers of social media groups, influencers, apps, and podcasts.

Those audiences already trust the entity they follow.

If you can get in front of that entity’s audience, that existing trust will pass over to you.

Here’s an example:

I subscribe to Nick Huber’s real estate investment newsletter. Nick says he has 42,000 subscribers.

Last month his newsletter included an invite to a webinar with his CPA, Mitchell Baldridge.

Every person that opened Nick’s email saw Mitchell’s face and the Real Estate Tax 101 webinar invite.

If only 1% of subscribers had attended his webinar, Mitchell would have shortcut the trust journey for 420 prospects.

What could you do with 420 prospects?


Value Over Volume

We have to price Advisory based on value, not volume.

The volume of transactions or hours worked will never adequately capture what your client receives.

The moment the volume of anything determines value, we’ve handcuffed our earning potential.

Advisory leverages what you know and not what you do.

Value is contextual. Your client and their situation determine value.

Say a client increases profits by $150,000 by using your advice. A $50,000 price tag for that result is an excellent ROI, not because it took 30 hours or because you looked at 1000 transactions.

It’s because they increased profits by $150,000. (insert yelling font)

The value is the outcome for the client. Base your prices on that outcome.

Today’s Tech

Today’s tech is not an app but a cautionary tale.

Spreadsheets are flexible and very useful.

But they’re prone to errors. Some of those errors can be immense.

Austria’s federal election ended with the wrong party in power.

The reason? An Excel spreadsheet error.

The error would have gone unnoticed if a reporter had not raised a question.

While spreadsheets are nice, apps that connect directly to your accounting software to report and present data are better.

Not only do apps reduce the chances of error, you can also run different scenarios or new forecasts quickly.

So before you prepare a budget, forecast, or financial scenario, ask yourself if there is an app for that.

Build The Firm You Want.


P.S. Email with something that you want me to talk about. I’ll add it to the list. 

  1. Get tips and learn more about me on LinkedIn.
  2. Check out my Guides for Growth and Past Newsletters
  3. Book a Free Automation Audit Strategy Call ($500 Value)
About the Newsletter

Every Friday, 1100+ accountants and firm owners get tips and tactics to build better firms that work for their lifestyle.

Connect with me
Recent Issues: