Perhaps I've just hit a bit of a bad patch;- I thought I'd managed to survive the 'recession' pretty well, but suddenly, over the last couple of months I've been losing clients hand over fist, and its getting quite worrying. Have been set up in business for 6 years, (AAT Qualified) so over the last two or three was feeling pretty happy with my set up; had wanted it part time due to family commitements, and all was going well. But as I say, over the last 8-12 weeks or so I have lost 5 clients for the following reasons :- Had enough of the stuggle to survive and retired. Sold business to someone who had their own bookkeeper/accountant. Had to reduce costs and decided they could do the bookkeeping themselves. Had to reduce costs and decided their accountant could do it all at year end for less Found someone who was (a lot) cheaper (less experienced). I could not match their apparant fee of £7 per hour. Had to reduce costs and have reduced my hours by half. No longer providing monthly management accounts, just a quarterly P&L and VAT calc.
So it looks like I'm going to have to get back out there and advertise myself again.
Just therefore wondered how you are all going with your businesses??
In complete contradiction to your experiences, on average I would say I have taken on two new clients a month over the past 12 months, and have only lost 1, today actually, as she has unfortunately passed away. However it may be that we are offering different services so it may not be a true comparison.
I do have a permanent advert in the local paper though, so this helps, although these days at least 50% come from recommendations from current or past clients.
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Jenny
Responses are my opinion based on the information provided. All information should be thoroughly checked before being relied on.
sorry to hear your plight but there does seem to be a lots of problems out there at the moment.
Personally I couldn't make enough out of bookkeeping to cover my costs and went back to banking. Last year I cancelled my practicing certificate and just last week I cancelled my ICB membership as I cannot see myself going back down that path.
One problem that I think we have is that we have to compete against unqualified and unexperienced bookkeepers who beat us on price as they don't have memberships and insurances to finance.
Although I'm no longer with the ICB I do fully support their current efforts to get bookkeeping recognised. I was one of those who petitioned the last government to try and make it mandatory that the accountancy and bookkeeping professions require professional recognition via appropriate memberships of relevant supervisory bodies but the answer that we got back from N0. 10 was that if they did that it would put too many poeople out of work.
I'm not saying that all unqualified people are bad at what they do or that all qualified ones are good but there has to be a level playing field out there so that those who go through the anguish of study, the expense of memberships and insurances, and the time and money invested in continued professional development are not undermined by those who do not have any such overheads.
In addition to the above things like the rising price of petrol seem to be the straw which is breaking the camels back and people are just giving up.
I know from personal experience that in the service sector one clocks up a lot of miles travelling to client sites (I've got one car with 310k on the clock and another with 185k!). There is no point even thinking about trains which are ridiculously priced, don't run when you want them to and don't get you to the miles out of town places where businesses have their head offices.
I'm a bit further up the food chain than many but I know that a lot of IT developers that have worked for me who are giving up on this country as the perfect storm of downward pressure on rates due to importing cheap labour from India combined with high costs just makes the work non viable.
Sorry, I'm off on a rant. But it really gets my goat that I really believed that the change of government was going to make a difference.... Unfortunately it has but not in the good way that the business community was expecting.
Hope that some of your other replies are more positive and uplifting than mine.
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Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
Hi Liz - sorry to hear about your recent experiences. Unfortunately, we all have runs like that, when it makes you stop and think. All of the reasons are common enough, none have been because the client was unhappy with the quality of service you are providing, which I think is important. Re £7 p/h, hope you haven't burnt your bridges for when it's a mess and they come crawling back :).
Like Jenny we had a good run towards the end of last year (sorry!), but not before we had a terrible week where we lost 3 clients. We looked into the reasons and thankfully none were due to the client being unhappy with the service we provided (1 was due to their previous accountant coming back to the area, 1 was due to the business being sold, and 1 was due to a strategic alliance that the client had with another accountant). Since then, 1 of the defectors said that they were having problems and wished they'd stayed, and the one that was sold asked us to quote for doing the accounts!
We've also had a couple of sole trader clients who decided to do their own tax returns this year, which in the current climate I can understand.
Sorry to hear about your business, I too was in a similar position the middle of last year, so from Aug last year started advertising heavily again locally and postcards in shop windows (got them done from Vistaprint), anyway finally the end of Dec things turned a corner, and picked up 3 new clients in 3 weeks and one of them is quite large so really please, but hang in there it does take time to get your name out there.
I sure things will pick up again don't reduce your fees to £7 per hour that is just rediculously low, I bet they will come crawling back.
Thank you for all your kind words. I know these things go like this, and no one has dropped me because they are unhappy with my work, just bad luck I suppose. Probably feeling it a bit at the moment as hubby came home yesterday to say his job is looking a bit shaky at the moment as well - bad timing or what!!
Oh, and I completely agree about the £7 per hour job. We left under reasonable terms, but I'm sure this new person won't understand what needs to be done with his paperwork - its not a particularly straightforward business!!!
Thanks again - off to print some post cards for shop windows......
Liz, Have you got a local parish magazine or community magazine?? If so these are always a good bet to advertise in and realitively cheap as well. I did postcards locally and also drove out about a 10 mile radius and put postcards up as well. One of my adverts which is about 5 miles away has got me a good client, so you just don't know where they ae going to come from.
I have to say I am facing the same, up to last week was very hectic, looking at Feb Diary not much out there at all. I have not started to worry to much as I could do with a couple of days off, even worked over the Christmas period.
Mine are not due to SA's as I do not do them.
I did have a client drop me through pricing as they thought £13 ph to much.
I do think it is going to be a very hard year, and clients are cutting costs, like you I have a client that is doing half of the bookkeeping themselves.
I have just renewed my membership yesterday, my practice license is not due till May so if it continues dropping off I will look at it then.
It's probably worth giving the client you lost to the £7ph bookkeeper a ring/quick email in three months time to see how things are, if they need any help etc. It may all have gone horribly wrong by then.
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Jenny
Responses are my opinion based on the information provided. All information should be thoroughly checked before being relied on.
£7 per hour, makes you wonder if they are just doing it as an hobby, or for pocket money? I would also question if there is any MLR supervision!!.
I had a situation where I took over from an aquaintance, who did the books for my client before me. She had no experience, or qualificaction, totally cocked up the accounts, and when I asked her who supervised her for MLR, her response was "what's MLR".
To rub salt in the wound, she charged more than I do!
I don't know how anyone could compete at £7 p/h and if people who are accepting that are only damaging the profession in the long run.
Regarding MLR it's still not widely appreciated, I had a meeting with a local council before Christmas about payroll outsourcing and when I mentioned MLR supervision the.y looked at me blankly.
Sorry to hear you're finding it tough Liz, fingers crossed you keep plugging away and things pick up.
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Tony
Responses are intended as outline only. Formal advice should be sort from your Institutes Technical Department or a suitably qualified Accountant.
It's certainly not a viable business. You see this a lot on People Per Hour, people will charge literally nothing to do a years accounts, CT600, Stat accounts, and clients actually go for it. I got fed up of bidding on there some time ago as I can't and wont compete with people that charge such tiny amounts. I'm not expensive by any stretch of the imagination but I make a proper living and can pay for all the necessary regulatory bumpf.
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Jenny
Responses are my opinion based on the information provided. All information should be thoroughly checked before being relied on.
This is probably a wild generalisation but if someone is that cheap, I wonder how much "guidance" the client gets that perhaps they're doing things wrong. Are they viewing their bookkeeper as as "data input clerk.
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Tony
Responses are intended as outline only. Formal advice should be sort from your Institutes Technical Department or a suitably qualified Accountant.
I'm sorry to read that so many of you are struggling with a downturn in business this year, whilst at the same time I'm heartened to realise that I'm not alone.
I've had my practice licence for about 18 months now, but so far I've not had one single, solitary enquiry. I've tried everything - pestered local accountants (think I might be about to cross the fine line between 'keeping in touch' and being a complete time wasting pest!), been to networking breakfast meetings (where there were at least two other bookkeepers or accountants, who were able to reel off an impressive client list), paid for an advert in the local press/newsagents and signed up to all the freelancing and job sites that I can find. I agree that 'word of mouth' is by far the best and easiest way to find new clients, but I just need that elusive first client to impress!
I think it all boils down to there being just too many bookkeepers grubbling for a finite amount of work. By searching the ICB practice directory alone, there are two other practices within 200 metres of my house and many more within a 10 mile radius - and that's just the ICB practices, it doesn't include bookkeepers or accountants qualified with the other supervisory bodies, or indeed unqualified bookkeepers.
At this rate I will have to give up by the time my practice licence renewal comes around again in August, I simply can't afford to keep throwing money away. It's so depressing!
Didn't realise my little moan would cause such a flood of agreement! I do think its got harder to get clients over the last 2 years or so. I too have pestered local accountants to sub contract work to me; some have resulted in work, most haven't. I think a lot of people who have perhaps being made redundent over the last 18 months, and have a small amount of bookkeeping/accounts knowledge, think 'I can do that' and set themselves up. I'm certainly not knocking the 'newbies' who post on here, but as with any unregulated profession, you get a certain amount of 'cowboys' and the 'cheapies' who undermine the rest of us.
I still have a client who original approached me for a chat about 3 years ago, then I heard nothing for 10 months. When he contacted me the second time, he admitted he'd gone with someone on a lower hourly rate, who he was now unhappy with, as she wasn't providing him with the Management Accounts he wanted. When I finally got the data of what she'd input, she'd only input his sales invoices and sales receipts all year; - no purchase invoices, no bank or cash payments, no bank reconciliations No wonder she couldn't give him a P&L, Cashflow or Creditors Report !!! Apparently it turned out her previous experience was as a Sales Ledger Clerk, hence posting the sales side of the accounts only! She had no idea how the rest of the accounting procedure worked!!
So remember that little story the next time a client says he's found someone cheaper than you!!!
Hi Liz - know it doesn't help with work, but at least you can see you're not on your own.
Re the 'cowboy' theme, businesses always look to save costs and there will always be someone out there willing to do it cheaper than you. We must never become complacent. When you sit at your desk and think "I've made it", that's when you need to worry!
How about asking existing clients for referrals? We always assume that happy clients will refer us, but that's not always the case. It can be surprising how many other businesses your clients will know, and it comes down to two old adages: "if you don't ask, you don't get", and the one that convinces me to keep the marketing mailings going and which has often been the case "in the right place at the right time".
I had to laugh after reading that, if a client is willing to give there books to someone who can only do sales then you have to think to yourself how far will one to cut back
Personally, probably a good time to look at your advertising and ensure you are attracting the correct sort of client that are going to appreciate a qualified professional. Anyone who would seriously think of comparing a junior non qualified staff at £7 per hour against a qualified professional may find they end up with more than they bargained for when important issues are being ignored, inspections start happening etc., etc..
Good luck in finding nice clients - they really are worth having.
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Donna Curling - Complete Book-Keeping Ltd (CBKLtd) - 07939 101900
In respect of the £7 per hour loss, at the end of the day it is the client who is making the mistake. A good quality bookkeeper should be charging £17-£20 per hour, across most of the country. The client will be getting a much inferior bookkeeper. Why not up your rates and look for better quality clients who will pay for your value.
Look at your marketing strategies and business practices. Are you typecast to Sage, are you just going for some cheap marketing yourself. This could be why you are not getting the repeat business in.
The MLR issue is also an important one. Accountants now give disengagement letters to their clients when they leave. Generally this just covers transfer of information etc. Maybe bookkeepers should do the same; it can be an opportunity to subtly show the client your how professional you are etc. I bet the £7 per hour bookkeeper doesn't even have an engagement letter.
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Phil Hendy, The Accountancy Mentor
Are you thinking of setting up your own practice or have you set up and need some help?
If so a mentor may be the way forward - feel free to get in touch and see how I can assist you.
Personally, probably a good time to look at your advertising and ensure you are attracting the correct sort of client that are going to appreciate a qualified professional. Anyone who would seriously think of comparing a junior non qualified staff at £7 per hour against a qualified professional may find they end up with more than they bargained for when important issues are being ignored, inspections start happening etc., etc..
Good luck in finding nice clients - they really are worth having.
Hi Donna, love your website, specially the way you have the boxes pop up in different colours, I hope you don't mind me saying but I found the text very small especially on theTestimonials / about us pages, My eye sight is fine lol, I think it would be better if the text size was increased! many thanks Lor
-- Edited by lor on Sunday 6th of February 2011 03:13:05 PM
No wonder she couldn't give him a P&L, Cashflow or Creditors Report !!! Apparently it turned out her previous experience was as a Sales Ledger Clerk, hence posting the sales side of the accounts only! She had no idea how the rest of the accounting procedure worked!!
