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Client Retention Increases Profitability

Client Retention Increases Profitability

What steps should you take to ensure client loyalty?

America is booming with millions of taxpayers looking for a good tax preparer. Post-recession changes have caused simple decisions to be tricky, requiring taxpayers to seek the advice of tax professionals more often. The fact of the matter is, being an efficient preparer takes a lot of time and developing relationships with clients is not always a priority.  But it needs to be.  Basic steps to ensure client retention are pretty obvious.  However, some things are worth a second glance.

Be Accountable.  The last thing a client wants to worry about is issues with their tax return.  A good preparer stays up-to-date on tax law changes and has the accounting knowledge to ensure clients are protected from discrepancies. New requirements from the IRS help with the implementation of accountability, but tax preparers still need to be able to ensure clients they know all they need to help them come out on top.

Be Available. A key to customer loyalty is to be there when a client needs you.  Simple things like promptly returning phone calls and emails make quite an impression.  And, of course, a quick turn-around of the tax return means a lot, too.  If a lack of staff results in a client not receiving the attention they desire (and deserve), that’s what they will remember the next time they need assistance with their tax planning, finances, etc.  Keeping your clients at ease during tax season means you’re doing what you need to for that client, and it also means you’ll see that client again next year.

Offer a Personal Touch.  Many taxpayers only turn to tax professionals when they need to file their taxes.  But if you offer a personal touch that makes them feel like you care about their financial well being, you might just be surprised at how much they appreciate you.  Consider scheduling a personal meeting with your taxpayer that will allow you to review key issues the client might need to hear about – speak about how to increase deductions through things like charitable contributions, or how to avoid tax penalties.  Also, a simple note or greeting card during the off-season can help build a strong relationship and  help keep the competition away.

Manage Your Time. Most preparer’s understand the rule that 80 percent of a firm’s income comes from 20 percent of its clients.  You can also look at it as 80 percent of a preparer’s time produces 20 percent of the firm’s revenue. And that time must be managed wisely.  The ability to delegate tasks that do not require a tax professional’s expertise (appointment scheduling, data entry, etc.) is key.

Stay Focused. Taxpayers often miss out on deductions and such because they don’t know all they need to know – that’s why they pay you.  Listen to what your customer has to say because it’s likely they’ll say something that will present an opportunity that shouldn’t be missed.  Listening to your client and focusing on what he/she has to say is a great way to build a relationship, and it’s a great way to drum up more business for yourself.  Most all taxpayers need help with financial planning, bookkeeping, etc., and you will have a chance to be there for them.

Be Prompt.  A busy office is often a sign of a good tax preparer.  But an office where clients have to sit and wait well past they scheduled appointment time tells another story.  It can easily be interpreted by the client that the preparer is unorganized and, in turn, make them question if the preparer has the ability to handle their taxes - especially if the return is more complex. Remember the need to make a good first impression and how that often starts the minute the client walks through your door.

The ability to plan and organize your day and your office will help you attract, nurture, and earn your client’s loyalty.  Successful client retention starts with the first contact your firm has with the taxpayer and will continue throughout the lifetime of the relationship.  The ability to attract and retain new customers is not only related to the services you provide, but to the way you treat your clients and the reputation you create.  Work hard to exceed expectations so that your clients stay loyal.  After all, customer retention has a direct impact on profitability – and who doesn’t what to make more money?


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The Taxing Subjects staff is proud to cover the latest in tax-industry-related news, from tax law and IRS updates to technology and business strategies. If you have questions about an article or just want to reach out to the Taxing Subjects staff, email comments@taxingsubjects.com.

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