Many CPA firms are seeing significant growth among the consulting services they offer, however, building these services is sometimes easier said than done. Here are 6 tips to ensure your consulting services succeed.
- Treat Consulting Services as a Business with Its Own P&L
If you want your consulting services to be successful, treat them as a separate business unit. Measure your profits and losses and track and allocate your expenses. Don’t roll consulting services into your accounting services; use separate billing codes that account for these services and train your people to use these codes. If you offer more than one type of consulting service, track these appropriately too.
- Price Differently
Pricing by the hour might cause you to leave money on the table. Most consulting services are driven by clients, which means you can offer these services at a premium. Consulting services are best sold as a flat fee service, so know exactly what is going into the scope of work before you price it out.
- Clearly Define Your Services and Deliverables
Many CPA firms venture into consulting based on ad-hoc client requests. In order for you to sell your consulting services, you’ll need to know what you are selling and what the deliverable to the client is going to be. Take the time to envision what you want to offer and identify what might be a valuable deliverable to the client.
- Have a Methodology and Process
Tax and audit services have a very clear methodology and process, see to it that your consulting services do as well. This will help ensure a high quality of delivery and make it easier for you to leverage all or parts of these services.
- Bring in True Experts to Run These Areas (Non-CPAs)
While many consulting services can be delivered by CPAs, not all consulting services should be. Consulting is a very different model than traditional tax and accounting services. Many consulting service lines benefit from having in-house experience. For example, Outsourced CFO services are often lead by former CFO’s and controllers. Don’t be afraid to hire in outside resources to lead these service areas.
- Model the Service Delivery Based on Business, Don’t Try to Mimic the CPA Firm Model
Consulting services aren’t a seasonal activity. If you are going to launch the service, be prepared to staff it. Depending on the service in question, the leverage model will be different. Some services may require more experienced people while others less.