The Freelance Bookkeeper

Even though you may consider yourself a freelance bookkeeper by profession, marketing must be one of your top priorities as a business owner. That’s because building your business is not something you do once and you’re done. It’s not static. Your business is constantly in the process of either growing or dying.

That’s why it’s important that we keep an eye on our marketing efforts, even in busy times, so business is always moving in the right direction – growing and attracting more clients.

To that end, I’ve become an avid student of marketing methods and even psychology. In truth though, like many freelance bookkeepers and QuickBooks consultants, I hate playing the role of sales person. But I do love to help people. So I’m always looking for great ways to market my business that focus on helping people, and having fun in the process.

That’s why I enjoy watching a weekly web TV show (something we will see more and more of this year, by the way) put on by Andrew Lock, an Internet marketer who likes to help all kinds of small businesses learn how to effectively use marketing strategies and tactics, both online and offline. His show is called, “Help! My Business Sucks!”

Catchy title, huh?

In a recent episode I found two golden nuggets that are especially important for attracting prospects to our kind of business.

1.  The importance of communicating clearly what you have to offer.

Our services are intangible and people often misunderstand what it is we actually do. This causes them to undervalue our services.

Our best solution is to educate our prospects. This can be done with your website, a brochure you provide about your business, or even in one-on-one conversations while networking.

Here’s the formula for effectively educating your prospects:

• Use a one-line statement to clearly communicate what you provide from a big picture standpoint.
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Include a specific benefit, wherever possible. For example:

“ABC Bookkeeping will bring your books up to date so you can manage your business profitably, and minimize your tax bill”
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• Give examples of all the problems you solve. This demonstrates the value of having a professional bookkeeper and helps them envision how your services benefit them personally.
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People think in terms of solutions (results) not in terms of tasks. So it is not necessary to list off the accounting functions you know how to do. This has little practical value to your clients. Don’t speak your language, speak theirs. They want to know whether you can solve their problems.

2.  Use a limit to helps people make a decision more quickly.

The video gave the example of how Disney does this with how they sell videos of their classic movies. They periodically offer them for only a limited time, and then pull the videos off the market. They do this to create urgency for buying.

This marketing method is known as “scarcity” and is a powerful tool for helping people to make decisions quickly. When someone says they want to “think about it” and make their decision later, 9 times out of 10, they will not buy. Procrastination kills sales.

The famous book among marketers, Influence: Science and Practice by Robert Cialdini, includes scarcity as one of the 7 most powerful factors when it comes to influencing people.

Unfortunately, it is commonly misused by manipulative marketers, and we are all pretty jaded because of it. But used sincerely and ethically, scarcity can nudge a prospective client in the right direction.

The two usual ways to create urgency are…

• limited time
• limited quantity

By adding some kind of special time or quantity limit to the services you offer, you encourage potential clients to make a decision more quickly and not procrastinate. And as we know with bookkeeping, clients just love to put if off. Of course, that only hurts their business! So giving them a nudge to engage your services is actually beneficial for them too.

Give a real reason for limiting your services, such as, “We can only accept five more clients until April 15th due to high demand for tax season deadlines” and you will automatically attract more business.

It’s a psychological thing. None of us wants to miss out on an important opportunity.

The caution here is to not use scarcity with negativity. Encourage action in a positive way so clients are benefited positively by working with you. Scarcity does not mean using scare tactics to bring in more sales.

There are several ways to use these golden nuggets in your bookkeeping business, with much success. In fact, in my brand new Cash Flow Mastery course, there is an entire lesson devoted to specifically putting these principles to work at pulling in more sales on demand.

Sadly, most bookkeeping services I’ve seen don’t pay much attention to their marketing efforts. That’s why they struggle. But you can make yourself stand far above your competition when you learn how to communicate clearly the benefits of your services. Show your clients why they need you now with a limited offer of some kind, and you will become irresistable.

Hmmm. The irresistable bookkeeper. Has a nice ring to it, don’t you think?

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Recommended Resources

Referenced episode of “Help! My Business Sucks” – Episode #91

Cash Flow Mastery – online training for cash-crunched entrepreneurs

Influence: Science and Practice by Robert Cialdini

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The book links in this post are affiliate links

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The most effective way to market your freelance bookkeeping services is by building relationships. Word of mouth and referrals are what supply almost all bookkeeping and accounting businesses with their clients.

So how does one build the kind of relationships that grow a strong bookkeeping practice? There are many ways. Of course, face-to-face, as well as online networking are key. But the vast majority of would-be networking bookkeepers make a BIG mistake and are wasting their time.

They aren’t getting results because they fail to follow-up!

If you’re serious about building your freelance bookkeeping business in 2010, make sure you follow-up with the people you meet at business mixers and seminars, or meet through online discussions.

One of the most effective, convenient and economical way to follow up with all of your business relationships (prospects, clients and strategic alliances alike) is simply through email.

Big surprise, huh?

When it comes to following up with prospects and referral partners, in fact, email is almost expected. Depending on whom you’re networking with, many small businesses no longer even bother to list their mailing address on their business cards – only their email address and phone number. Electronic contact has become the norm.

Yet as easy as it is, I am amazed at how many times I’ve met people at seminars or networking situations where we really connect, yet I never hear from them again. Has that happened to you?

Of course, email works both ways. I find in my own case, I may have a fistful of business cards of folks I intend on staying in touch with after connecting in person, yet time can pass quickly, and then it feels a bit awkward to send an email. Will they even remember who I am?

That’s why now I make the goal of contacting new prospects and alliances within only a couple days of returning to the office. It becomes a priority on my daily list. I also keep the first email short and sweet.

Of course, it can be more of a challenge if there is nothing specific to talk about in the email other than, “Hey, it was great to meet you and let’s stay in touch.” It’s a bit easier if there’s a more specific purpose for the message. So I try to ask a question based on what we spoke about when we first met. The idea is to continue the conversation and have a reason to stay in touch.

And that’s the point. The true value of using email is to build a relationship. And relationships are what will keep referrals coming your way.

A Word of Caution

The temptation in email, especially on a business level, is to attempt to get immediate business and directly sell your services. Be careful with that. It can end the relationship in a hurry if your in-person encounter had more of a social tone and business discussions were indirect. Keep your messages on that same level as your initial contact until you know each other better.

On the other hand, if the people you meet showed an interest in learning more about your bookkeeping services specifically for their own business, then by all means, arrange a phone call or follow-up meeting to take the conversation to the next level. Use your discernment here as to how hard or soft to sell, just don’t lose site of your objective – to build a relationship first. If you do it right, the referrals will follow.

Another way I’ve seen people use email as a follow-up tool from networking events is to add everyone they’ve met to their email newsletter list. While this may seem like a good idea, be very careful with it!

If you send out regular sales messages or newsletters via email, unless the recipients specifically asked to be put on your emailing list, you may be breaking the law! The FTC provides guidance on how “The CAN-SPAM Act” applies to sending out commercial email messages. Even if you are a sole freelancer, these laws apply to you too.

A better procedure would be to follow-up personally one person at a time via email after a networking event. Let them know about your online newsletter and ask them if they’d like to receive your messages. Giving them a choice not only puts you in compliance with the law, it shows respect and further nurtures the relationship.

How to Use Email to Get the Best Results

While email is a communication tool that can be very effective in building your business, it takes time to see results.

One email will not bring you a flood of new clients. As in any type of relationship, communication must be maintained on a regular basis, otherwise the relationship will eventually die. So be sure to stay in touch with the best contacts you have on a consistent basis.

As mentioned in the book, “Successful Email Marketing Strategies,” email marketing is more like farming than hunting. You are not trying to capture new clients, but grow them from your consistent efforts over time. If you stick with it, you will reap a healthy network of contacts that will send you a crop of new clients almost automatically over time.

Next Steps

While sending personal email messages one at a time can be effective, as your network grows, it can also become very time consuming. That’s why I do recommend having your own email newsletter or other way to stay in touch with all or groups of your contacts all at once in an automated way.

I’ve seen many small businesses simply attempt to do this using Outlook or their email address book. This is not the best way to do it, and can ultimately become a nightmare. An email service is a better way to handle this chore easily, economically and legally.

But there is a lot more to effectively using automated email marketing to really ramp-up your business relationships. And there’s lots of questions about best practices in this area too, to save time and frustration with the technical side of it all.

That’s why I’m going to be attending a webinar being held live next week by Ely Delaney of My Business Marketing Mentor. I know Ely personally (we met at a business seminar!) and he is an excellent teacher and quite passionate about automating as much as possible…instead of doing everything manually. That’s my weakness, so I know he’ll have some great tips, tricks and techniques to share for getting more done with less.

If you’d like to join me in attending this training, I’ve added a link to the sign-up page in the Resources section below. But be warned, this is a small online class with only 50 slots available (I’m not sure how many are already taken). So I’ve already signed up because I know it will sell out fast. It’s happening next Tuesday, December 29th at 5:00 PM Eastern Time.

In any case, start using email as your primary follow-up tool to build your referral network, and you will create a solid foundation for growing your freelance bookkeeping practice for years to come.

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Please Note:  Some of the links in this post are affiliate links and I may be compensated for my recommendations. However, I will never recommend anything that I don’t personally believe in or use in my own business. Your questions and feedback are invited.

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Resources:

Automated Email Marketing Systems webinar (Tuesday, December 29 at 5:00PM-Eastern Time)

The Complete Guide to E-mail Marketing: How to Create Successful, Spam-free Campaigns to Reach Your Target Audience and Increase Sales – recommended reading

Aweber – the email list management service I use (and love)

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On December 1, 2009, recent changes to the Federal Trade Commission Act affecting online marketing, blogging and advertising will go into effect. The expanded regulations affect every US-based individual and business that sells or recommends products and services on the Internet. So if you have a website for your freelance bookkeeping business (and you should) or post on social media, you need to know about this.

What’s it all about?

“The original FTC act ‘prohibits deceptive and unfair acts or practices in commerce and misleading advertising of drugs, foods, cosmetics, devices and services,’ and these prohibilitions apply online and offline,” explains Richard Cleland, Assistant Director of the FTC Advertising Practices Division in a recent online interview.

The new guidelines expand on how the regulations apply to online marketing. With the ease in posting recommendations for third party products and services, such as using Amazon affiliate links, this change affects nearly everyone who has any kind of commercial dealings on the Web.

In which situations does it apply?

Specifically, the new rules apply to anyone who posts on a blog or website using affiliate links or where customer testimonials are used to sell a product or service. Any kind of reviews or recommendations online where compensation is involved are also included.

The fact that there is compensation involved now must be plainly disclosed. Where testimonials are involved, average customer results must be disclosed. It is no longer adequate to state that “your results may vary,” as has commonly been done by many.

What to do next

Since the new regulations go into effect next week, if you have a website where you use testimonials or affiliate links, you should figure out what needs to be revised on your blog(s) and/or website(s) to bring them into compliance and avoid getting snagged by the authorities. You may also have to change the way you post information with commercial connections on Facebook, Twitter and LinkedIn.

The rub is, the new guidelins are not especially clear on how they specifically apply to some situations. So the best advice is to check out the information available on the FTC website itself. I’ve also included additional resources below, including an interview just released this week by online business expert, Jim Edwards, and FTC official, Richard Cleland, which includes real life examples of online advertising and how the requirements for disclosure apply.

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Resources

The official FTC guidelines that take effect on December 1st.

Jim Edwards interviews FTC Official for clarification of the new guidelines

Interpretation of FTC guidelines by an Internet lawyer

How to use the new guidelines to your advantage with testimonials

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Sounds good, doesn’t it? But how can you get those kinds of results in your freelance bookkeeping business….especially now?

Training.

No, I don’t mean TAKING more training classes. I mean GIVING training classes.
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Why Public Speaking & Training Will Help Your Business NOW!

When you step up and take on the role of trainer, by giving a talk or by conducting a class or seminar, you are positioning yourself as the expert. Few bookkeepers ever step into the spotlight and offer helpful advice to small businesses. If you do so, you set yourself apart from the competition and build tremendous trust in a hurry.

In this economy, trust-based marketing is more effective than anything else at attracting new clients. And not just any clients.

Quite likely the people who will come to hear your pearls of wisdom will be interested in either managing their business finances more effectively, or finding a better way to get their bookkeeping done. These are high quality client prospects.

After they see you in action and feel as though they know you, if they need additional assistance, who do you think they will contact? (And who will they recommend when a colleague needs assistance with cleaning up his books at year end?)

Of course, if you are conducting a training class, say in QuickBooks, you can charge a fee for sharing your knowledge. You won’t get rich on teaching these classes, but it can help smooth out any cash flow pinch you may be experiencing right now. You’ll also be sowing seeds for pulling in new clients in both the short and long terms.
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Don’t Be Afraid to Give Away Your Secrets

Even in this tight economy when many of us are losing clients because of cut-backs, you can be the hero who teaches small businesses how to get the most out of their financial reports, or teach them how to use QuickBooks effectively. You won’t be teaching how to live without you. In fact, they will likely be calling you for help to  clean up their bookkeeping mess later when they don’t apply what you’ve taught them. (See my previous article on how to handle this situation gracefully – “When Clients Want to Do Their Own Books” )
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What’s Involved?

In-person talks – Small business networking groups or your local Chamber of Commerce are usually looking for speakers who can share useful information with small business owners.

On-site or off-site classes – Another option is doing small group classes, such as for QuickBooks basics, for an organization such as the SBDC, Chamber of Commerce, or even a local continuing Adult Education programs. These may be paid or free gigs.

Online training – This is my favorite way to conduct training events. You can do both free and paid events at very little cost. Both teleseminars, which are conference calls, or full-blown webinars work well, depending on the topics you will be presenting. Even hands-on QuickBooks classes can be done on a virtual basis with small groups. Lots of possibilities here.
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What to Teach?

Answer FAQs – Answering the most common questions clients ask or giving helpful tips on how to handle the most common problems you see clients struggle with is an easy way to provide very useful information to your audience.

Practical How-To Info – Of course, how-to information is always popular. This could include a class on how to interpret financial reports, or a simple way for small business owners to set up a working budget or forecast their cash flow. And of course, QuickBooks training is the most popular for full-blown classes.
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Is It Really Worth the Effort?

YES! Whether you pull in some quick cash, pick up a couple new clients, or simply establish yourself as the go-to bookkeeping expert in your community, you WILL see results for stepping up and providing valuable information to small business owners. That’s the stuff on which powerful relationships are built. And building powerful relationships is the most solid way to grow your freelance bookkeeping practice.
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Get Into Action

The best way to learn is by doing. If you are already involved in your local business community, see what opportunities are available to get you started. Start out small to build your confidence.

If you’re more on the shy side, online is the way to go. That’s why I started with online classes. They’re less scary. Your choices are teleseminars or webinars. I prefer the latter, but they are more involved.

I learned how to do webinars from an online training course that was only available one time, a couple years ago. It was far and away the best of the few trainings I’ve ever seen available since.

If you do want to try your hand at doing online events, I’ve got good news! Just last week I learned that this same online webinar training course has just been updated (due to changing technology) and is available again, right now, in fact!

In my experience, webinars are THE best way to build your reputation online and thus open your business reach to a more than national scale. So this training course gets my top recommendations. In fact, I’ll be attending it again so I can stay up to date on the latest techniques. (See more details under the free Resources below)

So get into action and get out there by speaking and teaching to attract more clients and more revenue. You’ll never look back once you do!
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~Gabrielle

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Resources

Free mini “crash course” on doing webinars

Free “Insider Webinar Strategies” LIVE webinar on Monday, October 12th

Free teleseminar conference lines

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Many freelance bookkeepers also do taxes for their clients. That’s probably why I so often hear the question, “Is it necessary to be a tax preparer in order to run a successful freelance bookkeeping service?”

The answer I usually give is…it depends.

Successful Bookkeepers and Taxes

There are many ways to be successful in the bookkeeping field. While tax preparation services can be a good source of seasonal income, it is NOT necessary of offer this service to do well. In fact, there are situations where NOT offering tax services may even be an advantage, depending on how you position yourself.

For instance, if you don’t have experience with tax preparation and don’t want to offer that service, it may be easier to build complimentary relationships with CPAs. They won’t be worried that you’re a threat to their tax clients, who are often their bread and butter. You can position yourself as a strategic ally by referring clients who need tax services, while they refer clients who need help with their bookkeeping to you. This works as a mutually beneficial relationship, especially at year end.

Taxes and Bookkeeping are Not the Same

Bookkeeping and taxes are two different things entirely. True, the information found in a client’s bookkeeping records is used to prepare the tax returns, but that’s where the similarities end.

If one knows only how to prepare individual tax returns, that does not mean that that person can handle bookkeeping. In fact, I know of a CPA who struggles with this very issue with his staff during the off season. His staff primarily knows tax prep. But when he needs them to work on adjusting a trial balance for his business clients, they are helpless.

The reverse is also true. Just because you understand double-entry bookkeeping does not mean you can breeze through tax return preparation. You need to be adequately educated to offer either service if you want to offer that skill to your clients.

Should You Offer Tax Services?

So my first bit of advice is, if you already have income tax preparation experience, and you enjoy it, then by all means consider adding it to your service offerings. It provides a one-stop-shopping convenience for your existing and future clients who may be in need of professional tax preparation.

However, I do NOT suggest that you attempt to “steal” tax clients away from their current preparer, especially if that person is their CPA. A strategic relationship with your local accountants is far more valuable than the preparation of an annual tax return or two. You always want to be building strategic alliances, not promoting adversarial competition.

If you offer tax services, be sure to keep your knowledge up to date. The tax laws change every year, so this is not a service you should offer if you are not willing to invest in ongoing education. Lack of knowledge in the tax arena can come back to bite you hard. The IRS is actively raising the bar for tax preparers and will continue to do so over the next few years. You’ve been warned.

Tax Laws ALL Bookkeepers Need to Know

Up to this point, we have been talking about income taxes. While including income tax preparation to your service offerings is not a necessity, there are some types of taxes you really do need to know about, at least on a basic level.

Most, if not all of your clients will need your guidance when it comes to payroll taxes, state and local sales and use taxes, and possibly meals and/or lodging taxes.

If you don’t already know the ins and outs of these types of business taxes, then you need to educate yourself so you can handle them responsibly. Usually the information needed can be found directly from the taxing authorities at the federal, state and local levels; checking their websites is the easiest option. I’ve included some of the most common resource links at the end of this article.

Pay Attention to Payroll Taxes

Probably the stickiest of business taxes are for payroll. Penalties and interest on mishandled payroll taxes are very stiff. So don’t fake it when it comes to handling your clients’ payroll services. Get help if you need it.

If you are not comfortable with handling payroll taxes yourself, you may want to insist that your clients hire an outside payroll service. These providers are well worth their fees.

Payroll companies not only prepare payroll checks, but they will also prepare and timely file payroll tax returns, seeing to it that your client’s liability deposits are made when due. That is of key importance.

Personally, despite the fact that I have experience handling payroll, I HATE it. So I insist that my clients use an outside payroll service. This keeps my clients out of hot water with the authorities, and lets me focus on the services I truly enjoy providing.

That being said, if you actually enjoy doing payroll, it is a valuable service that can provide a source of steady revenue, if you aren’t already offering it to your clients. The QuickBooks ProAdvisor program has a nice package at a reasonable price for those who provide payroll services to their clients.

It All Depends on What You Want

As is clear from this discussion, there are lots of choices when it comes to taxes and bookkeeping. In reality, you get to choose which combination of service offering will best support what you envision for yourself and your business. Just realize that there are advantages and disadvantages to each situation.

Make Your Choice and Stick With It

Once you’ve decided which service combo is right for you, keep up to date with the education requirements. Provide the best service possible for your clients. After all, that’s why they hire us – for our expertise.

Top quality service will fetch you the best fees and keep your business growing. Happy clients are your best source of new referrals. That holds true no matter what the economy is doing.

So “should” you offer tax services? That’s entirely up to you. It just all depends on your current (or desired) skill set, how you envision your business, and the services you enjoy providing the most.

Resources

National Tax Training School

National Association of Tax Professionals

Federal Income Taxes – Tax Professional Resources

Federal Employment Tax Resources

US Sales Tax Information

Sales Tax Rates Quick Reference List

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WANT TO USE THIS ARTICLE IN YOUR OWN BLOG OR E-ZINE? You have permission to re-publish it, as long as you include the author’s bio paragraph and links below:

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Gabrielle Fontaine, PB is a freelance Professional Bookkeeper and Advanced Certified QuickBooks ProAdvisor. She publishes the free online newsletter, The Freelance Bookkeeper, and is co-author of the new book, “How to Start A Successful Home-Based Freelance Bookkeeping and Tax Preparation Business,” available at Amazon.com

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