I want to share a story which really illustrates the power of networking for CPA organizations. In my opinion, it should be a CPA requirement for CPA firms.
I have a friend who is a CPA. For many years she’s had a successful practice and has never had to go out looking for new clientele. She lives in the triangle area of North Carolina and has clients throughout Chapel Hill, Durham, and Raleigh. In November of 2011, shortly before the start of Tax Season, Caroline received a bad medical report. Actually, the news was quite devastating; Breast Cancer.
Caroline was in complete shock. With tax season just beginning, this was not the kind of news she wanted to hear nor expected. She was what appeared to be, very healthy. With her husband and three teenage daughters at her side, Caroline went through chemotherapy, radiation, and a double mastectomy. There were complications and Caroline experienced a much longer recovery than anticipated. While all this was going on, Caroline’s CPA practice dwindled down to almost nothing. She was eventually able to go back to work, but she had no clients to work with.
In December of 2012, Caroline went to work for another CPA firm to help out for the upcoming tax season. Caroline did so well and helped the other CPA so much, when April 15th passed, he offered Caroline a full partnership. However, the requirement was that Caroline would have to bring a certain percentage of new clients over the next year and an additional number of clients over the coming years in order for the partnership to continue. Caroline saw this as a great opportunity. Either way, she was going to have to bring in new clients if she was going to start her own CPA firm again. Caroline was faced with a situation she had never faced before, going out and getting new clients.
We met for coffee on a Monday morning and Caroline explained to me that she was very concerned that she would not be able to get new clients. She has never had to do prospecting before and had absolutely no idea how or where to start. The one thing that came to mind was her CPA organization or Accountant organization. But, she was unsure how to use it. She complained that she is not a sales person. I let her talk and cry about not being able to take on this task. She contemplated the idea of working for a franchise accounting firm. I waited until I felt she was ready to listen.
“How many new clients do you need to bring before next tax season?” I asked. Caroline answered “Thirteen.” That’s 13 new clients in 8 months. I asked Caroline if that was possible. She explained that it was very possible for someone who knows sales and marketing. Again, she reminded me that she knows nothing about either. I explained to Caroline, “We’re going to do some Networking. I think you will do very well as a networker. We will help you build a network of clients and referral partners that will blow that 13 number out of the water.” She was about to experience the power of networking for CPA’s and CPA organizations.
I took out a sheet of paper and I asked Caroline to write down the names of 10 of her former clients. After she wrote down the names, we developed a letter to reach out to these former clients. In the letter, Caroline explained that she is back in action and in great health. She understands that they are working with new CPA’s and hopes they are very happy where they are now. What she asked each former client for were referrals to other people in their spheres of influence. Caroline explained she would call on a certain date and time to discuss.
Caroline was very surprised by the response she received. Of the 10 letters Caroline sent out, only 2 of the former clients could not be available to speak to Caroline. 7 out of the remaining 8 made referrals to multiple new contacts and 2 of the former clients rehired Caroline as their CPA. Caroline was off to a good start. Of the multiple referrals Caroline received, over the course of the next several months, Caroline was able to convert 4 of those referrals into new clients. Caroline didn’t wait for the phone to ring. We still had to reach that 13. This was just the beginning of the networking strategy.
For a month, Caroline went to multiple networking meetings to get a feel for the professionals attending. At first she was very scared and shy. I went with her to a several of meetings when she first started going and introduced her to as many people I could that I thought could be of help building her business. Some of the meetings, Caroline found very helpful. Some she found were not her cup of tea. This is one of the things to discern when networking.
Caroline also visited several exclusive networking organizations that allow only one CPA member or firm. The investment to join the group of $500 was tough, considering she was still fighting her way back, but she looked at it for exactly what it was, an investment. She narrowed it down to one organization, joined and became a very visible active member of the group.
Caroline also became active at the Chamber of Commerce. She volunteered at events when she could. She attended most of their networking events. Caroline was becoming very visible. She also became a board member of her CPA organization. People were talking about Caroline everywhere. She began to know many people in the business community and began referring people in the business community every chance she got.
Developing referral partnerships became very helpful in building Caroline’s business. She developed alliances with other non-‐competitive professionals that were going after the same target clients. They passed business back and forth to each other, helping to increase visibility and reduced the need for cold calling.
I helped Caroline develop a tracking system so she could keep an eye on the contact list she was building. She purchased a subscription to a Customer Relation Management system that helped in building her database. After speaking to other CPA’s that networked well, Caroline determined when and how to stay in touch with her new contacts. She stuck to her system and continued a steady program of follow up.
Then the magic started to happen. One new client, led to two new clients, led to five new clients. Caroline was a superstar connector. In her Exclusive Networking group, she was passing and receiving the most referrals every week. She was experiencing the law of reciprocity. People wanted to give Caroline a referral.
By December of that year, Caroline had 30 new clients. When tax season began, Caroline and her partner had to bring on additional help just to make it through the season. I didn’t see Caroline for a few months.
We had coffee together one morning in the summer. She talked about being involved in an organization that supports woman entrepreneurs and was becoming very active. She told me she didn’t know how she had ever worked without networking before. Caroline was extremely pleased with the level of business she was building, and then she exclaimed that the great relationships she developed through networking was a benefit she never expected.
The power of networking for CPA organizations is tremendous and should be a requirement for any firm that wants to be successful.
Call me, Joe Novara to learn more and hire me to train/speak/motivate you and your staff.