Exactly two weeks from today, our entire profession will wake up and breathe a sigh of collective relief.
But the really smart cookies in the audience will treat April 16th in the exact same manner that they treated April 15th.
Of course, if your entire practice is seasonal tax return preparation, and you have no interest in changing that, then you can simply ignore this entire article.
For year-round tax professionals, however, April 16th is not a relaxation day. Nay, nay. Rather, it is really just the beginning of the Second Tax Season. If you play your cards right, tax season part deux (I’ve been in Europe too long…) can yield even higher revenues than the filing season. Here are three habits that you should NOT break out of with the end of filing season.
First… You’ve most likely become accustomed to working more hours. The vast majority of tax professionals rapidly cut there working hours following the passing of the IRS 1040 filing deadline. This is a tremendous mistake.
You’ve most likely heard of the “Four Hour Workweek” book, and the entire movement that it started. As somebody that lives an actual four hour workweek for a month or two at a time several times per year, I can tell you that yes, it’s a good life. What people fail to mention, however, is that arriving at the magical four hour workweek takes a tremendous amount of setup time. It took me nearly four years to create the systems that allow me to “coast” for weeks on end when I travel. My average workweek during that build up time exceeded 60 hours.
If your goal is to have a lifestyle-based business, that allows you to work remotely with clients or to step away entirely for weeks on end, then you need to put in the hours now in order to build that kind of business. Even if you have no desire to live this way, but simply want to retire early, then the same rule applies.
Second… During tax season, most tax professionals develop better marketing and sales habits. You’ve (hopefully) been implementing new lead generation marketing. You’ve done client reactivation campaigns. You developed a “refer-a-friend” program. On the sales side, you developed stronger sales closing abilities due to your frequent, daily sales interactions with tax prep clients. Even if you don’t think of it this way, you have frequently handled sales objections in regards to your fees, tax laws, etc.
These marketing and sales habits are things that you should do year round. Yes, I’m telling you that should maintain your tax prep marketing twelve months out of the year. It may take different forms, and use different media, but you should still be doing it. Right now, you should also be ramping up your tax resolution marketing if you offer that service. You should be marketing to find payroll clients, bookkeeping clients, tax planning clients, wealth management clients.
You should constantly be seeking new clients, assuming that revenue growth is a goal you have for your practice. You should always be looking to identify new opportunities. For example, the healthcare open enrollment period just ended. Some people need tax planning and/or short-term gap coverage. Do you have a health insurance license? Do you offer tax planning? This is a small, but not insignificant, opportunity for some tax professionals.
There is an entire world of folks out there that haven’t filed a 2013 return yet. Heck, many haven’t filed their 2012, or 2011, etc., returns either. There is a world of tax debtors. There are brand new business startups. There are people that just moved into town. There are people experiencing life changes. All of these are client attraction opportunities for you, and you should be actively marketing your services to them.
Don’t neglect your existing clients, either. You should be marketing to your existing clients each and every month, year round, year in and year out. If nothing else, you should have a monthly client newsletter that is printed and mailed. Even more minimal (but not nearly as good), is a monthly (or weekly…) email to clients. Always be marketing to your existing clients. Always be cross-selling your other services to existing clients. Always be asking for referrals from existing clients. Marketing to your existing clients is your most affordable way to attract additional revenue.
Don’t neglect the sales habits that you developed during tax season. Interact with prospects and clients in consultation and sales situations on a regular basis. Maintain this habit year round, as it is a skill just like anything else. It’s the skill that puts money in your bank, so be sure to always be practicing it.
Third… During tax season, you probably brought in seasonal staff to help run your business. You do this because it helps you be more productive, and increases revenue. You know this helps your business during tax season. Therefore, why do countless tax professionals run the rest of the year with far less staff, or even none?
Most tax practitioners cut back during the “off season” because they’re not as busy. But, as already indicated earlier in this article, they’re less busy by choice. They cut back on their office hours, and shut down all of their marketing, so of course they’re not going to be as busy.
If you follow suggestions one and two, and you DON’T cut back your hours and marketing, then you’ll find that you’ll be busy. If you really wanted to, yes, you can be just as busy during the second and third tax seasons as you are during the first tax season.
Maintaining a busy, year-round practice, no matter what services you’re offering to do so, is going to be aided by being well staffed. One of the core ideas in my Tax Practice Success Automation webinars is that you need to delegate all tasks below your pay grade that cannot be eliminated or automated. To grow your revenues, you need to focus on higher dollar per hour work. In other words, you’ll never get rich by doing the $10 to $50 per hour work in your practice.
If nothing else, use your seasonal hiring as a filter for helping you find top quality people to add to your team full-time. Tax filing season can be a great “feet to the fire” time, and helps separate the wheat from the chaff. Keep the good ones that can contribute heartily to your long-term growth goals.
To summarize, if you avoid making these three common mistakes after the end of the first tax season, you’ll be in a much better position for the rest of the year. You’ll see your practice grow, and you’ll be able to focus on the activities that create revenue and put you on the path to having a lifestyle practice.
To summarize these three points:
1. Don’t cut back your work hours.
2. Don’t stop marketing.
3. Don’t lay off all your seasonal staff.
I’m confident that if you follow these three pieces of advice, you’re going to have a MUCH different year this year than you did last year. You’ll spend more time working on your practice, rather than just working in your practice, which is ultimately necessary for creating a rapid-growth business.