When is enough growth enough for your practice?

Accountants discuss finding the sweet spot between business growth and deep client relationships.

What’s more important: business growth or client relationships? For most businesses, there’s a ‘sweet spot’ between the two, with a focus on sustainable business growth while nurturing current and existing clients.

But sometimes it doesn’t work out like that – some businesses can become so focused on growth, prioritising sales and marketing and reaching out to new markets, that they forget to look after clients already on their books which can lead to a reduction in quality and service. Other fast-growing businesses may lack the resources to sustain business practices.

On the other side of the coin are the businesses that make a conscious decision to focus entirely on client relationships. For them, closing their books to new clients for sustained periods and focusing instead on providing a great service to current clients may prevent expansion later on.

A sustainable growth plan may include:

• identifying (and continually reviewing) achievable targets and KPIs for long, medium and short-term
• reviewing current capacity and identifying achievable growth rate
• producing cashflow forecasts
• investing in staff development or recruiting for specific skills
• providing excellent service and value for clients
• improving client satisfaction levels (including regular client check-ins and contact)
• implementing a clear sales and marketing strategy.

We asked several accountants where they sit on this issue. Is it possible to focus on growth while developing and improving existing service? Or do some accountants favour a cyclical either/or approach?

There’s an art to balancing growth and satisfaction

Jess Middleton, AAT-qualified, Founder, MPAS UK (Middleton Professional Accounts Services)

Like most business owners, I believe in business growth. However, I don’t believe that growth should come at the price of diminished quality of service for existing clients. This is something we have been working to balance since our start in 2020 and last year we turned a corner.

What’s the point in growing if you are losing clients at every turn? Of course, clients will move on naturally due to various circumstances, but you don’t want one of those reasons to be your work. Quality feeds growth. Referrals can certainly be your best friend when it comes to growing. The key is ensuring your growth doesn’t outpace your ability to manage the workload including having regular communication with clients.

This is how we plot sustainable growth:

• We look at management accounts so far in the financial year to review business progression and identify patterns of income (i.e which months show highest income and which show lower?)
• We use a database to track and review our own capacity, based on how up-to-date we are with work and realistically how much more we could take on.
• We review recent feedback, including a monthly 15 minute catch-up call and constant contact with clients via WhatsApp.
• We look at what growth rate is sustainable to keep the balance: keeping clients happy and continuing to grow to reach our targets.
• We produce a cashflow forecast to see how this looks and then decide whether we need to increase our headcount at some stage in the future to help maintain growth and quality.

Currently, we have a very doable and sustainable growth target of 10% on the year.

Verdict: It’s possible to focus on sustainable growth and keep clients happy, but it’s an art which takes constant readjustment.

We’re at the point of ‘enough growth’ and are focusing on great service

Sharon Wray, FMAAT, Director, Sharon Wray Accountancy Services

I have been fortunate in my practice that growth has been organic without any sales or marketing but there have been times when I had too many clients and the overwhelm was detrimental to my health.

You then have to consider either scaling down or hiring another person. I have done both, but only after the realisation that something had to give. I’m now in the position where I can scale down further and keep good clients who I want to work with, adding value to their business.

It’s about the right client fit for your business and having the courage to let legacy or low-paying clients go. We now concentrate on working with the best software on the market to maintain great client service and relationships.

Making the decision not to grow any more really works well for us, but it is finding the balance that works for you. I’ve seen clients be busy in their businesses, working all hours, only to reach burnout and subsequently lose work because they have taken their eye off the ball.  It’s such an important lesson to realise where your business is sitting on the spectrum of value and growth so that informed decisions are made for the better.

Verdict: Too many clients can be detrimental to a business then something has to give. We’re at the point of ‘enough growth’ and are focusing on great service and adding value.

I’m implementing a client waiting list to keep my business purposely small so I can focus on existing clients and family

Tom Smith MAAT, Director, Every Cloud Accounting

My plan is to stay small and profitable. I want to build a ‘lifestyle accountancy practice’ and prioritise life as well as business. I have a newborn so I don’t want to build a big accountancy practice with HR, staff, offices and so on. I want to spend quality time with my son, whilst offering a great service for clients and building the business.

A lot of accounting conferences are all about growing, getting to X number of staff members, but I want a flexible business that serves the life I want. My goal is to get to six figures in revenue, continue delivering a great service for clients and have time and balance in my personal life.

The decision is based on running businesses in the past, where I have had it the wrong way round and ended up in a job chained to my desk. The key resource to look at will be my time and I will only take on clients up until a certain capacity. I may hire a VR/bookkeeper but I will be keeping the business purposely small.

There is definitely a point where it’s sensible to focus on servicing existing clients. It’s easy to be on the treadmill of sales, sales, sales, but that can come at the price of the levels of service you’re offering. When I get to a certain capacity, I plan to pause taking on new clients and create a waiting list, so I only take on new clients when I am in a position to deliver a great service.

Verdict: I’m keeping my practice purposely small with a client waiting list so I can offer great client service while having quality time with family.

Would you like to contribute to future articles like this one? If so, please get in touch with Annie Makoff-Clark at [email protected].

Annie Makoff is a freelance journalist and editor.