More often than not, you have greater control over your clients churning than you think.
While not every client is worth rescuing, understanding the top reasons why people change accountants is beneficial in ensuring you keep your best clients.
Simply put, it’s expensive to replace your churned clients. In fact, it can cost anywhere from 5 to 25 times more to acquire a new client than retain an existing one.
Churn can be bad for your reputation, bad for staff morale and, if you’re running a tight ship, bad for your bottom line. It’s a sound business investment to spend time and energy reducing it.
Here are 8 reasons why clients churn, and what you can do at your accounting firm to prevent your high-value ones from doing so.
Simply reviewing and raising your accounting firm’s prices might be the one thing that leads your clients to shop around for someone cheaper.
How to prevent clients churning after raising your prices
Some clients will inevitably leave if you raise your prices, but you can limit those who do by clearly communicating the reason for your price increase. Even if the reason is as simple as a seasonal adjustment.
You don’t need to justify it, you just need to explain it.
And remember to reiterate the value you bring to them. Ensure they truly understand the impact you have to their business.
“You’re not selling accounting services, you’re selling certainty.”
Naturally, people are afraid of change. Particularly if they don’t understand it. Chances are that if your firm is involved in M&A, your clients will have to deal with changes to:
This might be enough to overwhelm them, leading them to search for another accountant or bookkeeper.
How to prevent clients churning after your firm has been acquired or has merged with another
As early as you can, communicate with your clients. Even if you don’t have all the answers as to what they can expect, let them know to expect some change.
And if your situation allows, reiterate the things that won’t change—their normal point of contact, for example. This will provide them with some certainty and ease some anxieties.
Recommended reading: The 3 keys to navigating change in your accounting firm
Partnerships gone bad. Economic downturn. Natural disaster. Robbery. Whatever the downturn, for some clients, it might be make or break. And that might mean they think they can’t afford your services.
How to prevent clients from churning due to financial struggle
Retaining your clients when they’re struggling is all about communication and negotiation.
If they’re in financial trouble, they need your support. Of course, depending on the situation, they might not think they can afford your support. That’s where negotiation comes into play.
Find a happy medium, where you’re supporting them during this time but not at the detriment of your own business.
Sometimes, clients want something now. They might think it’s a simple request, but in reality, it takes time and resources to compile. Naturally, you’d want to charge for that billable time, and given how simple they think the request is, your clients might not want to pay.
How to prevent clients from getting frustrated that you’re charging for billable work
Communicate that to complete their request, you need to divert resources from other billable tasks, and as such, you need to charge accordingly. If they don’t seem to understand or accept that, then perhaps it’s time to let them go.
Recommended reading: How to turn a tough client into an ideal one
Sometimes, things go wrong. When you’re handling people’s livelihoods, errors can be costly.
How to prevent your clients from churning due to a poor experience
Depending on the situation, your clients may have lost trust in your accounting firm. While you can’t undo the past, you can move forward and work towards rebuilding that trust.
Communication is key here. Help your clients understand:
What went wrong
Why it went wrong
The steps you’ve put in place to ensure it doesn’t happen again
If you or your clients relocate, it might seem natural to them that they need to find another accounting practice that is local. But you no longer need to be in the same town, city or state as your clients to bring them the value they need.
How to prevent your clients from churning due to relocation
As long as you have the technological infrastructure to operate digitally, you can maintain client relationships if either you or your clients relocate. You just need to make sure they understand that.
Recommended reading: 10 tools for remote team collaboration
You might have started working with some of your clients when their businesses were in their infancy—before employees, before an office, before the owner was receiving a salary, and sometimes, before an actual product was being produced.
But with your support over the years, their businesses are growing—they’ve employed staff, added new products, expanded their geographical reach, and they’re ready to take the next step.
But if that next step requires a service you don’t offer, they may search for another trusted advisor.
How to prevent your clients from churning as their businesses evolve
Just like your clients’ businesses are evolving, consider diversifying your own service offering.
For example, you may notice multiple clients expressing the need for an advisory service you don’t currently offer, like HR advisory. If you can justify the costs and training associated with adding this service to your firm, it can help you retain your clients as they grow and mature.
People talk. Your clients network with other business owners, and perhaps they’ve heard about someone else’s relationship with their accountant, including fees and services offered. And maybe they start thinking they’re not getting enough value from your firm.
How to prevent clients from churning as a result of perceived value elsewhere
A great place to start is by having a frank conversation with them. Understand their pain points, where they’re feeling a lack of value, and exactly what they expect to receive from another firm.
This conversation might uncover information that your client hasn’t shared with you, such as their desire to grow their business in a particular way. Without that information, chances are that your service offering to them wasn’t specific enough. But now that you’re informed, you can adjust accordingly and provide them with what they need.
Recommended reading:Why communication is the most powerful tool for your accounting firm
More often than not, a conversation is the difference between losing a client or retaining their business. If you think certain clients are unhappy or are shopping around, book a time to talk with them to make sure:
You’re meeting their expectations (and they’re meeting yours)
They understand the value you bring
If and how their situation has changed since you last spoke
When you recalibrate with them, you’ll be better-placed to strengthen your relationship. At the same time, a recalibration might not be possible—in that case, it’s time to part ways. And that’s okay.