How to generate new business: Best practice guide for tax professionals

How to generate new business

When tax preparers sign up for the job, they know all about the annual tax-time crunch. Many see it like Black Friday, when four months of long, exhausting days generate much of the year’s income. Isn’t it time to put the other eight months to better use and cut back on a few of those tax-time hours? You can do it.  

By elevating your services and generating the right clientele, you can heighten your professional standing and earn more money. A few simple steps can help you strategically market your services, generate new business and cultivate new lines of business among the people who already know and trust you – your existing clients.

How to market a tax preparation business: 5 easy steps 

The good news about tax preparing as a business? It’s always in demand. The bad news? Demand surges in January and plummets in May. Chances are, you’ve advised your own clients to diversify their income streams. Now, it’s time to follow your own advice.  

Best of all, you can increase your income without piling more work on your plate. These five steps add value to the time you already put into the business:

  • Identify your ideal client. Admit it. Some clients are easier to work with than others. They have their documentation in order. They promptly respond to your questions and instructions. You will always have difficult people, but you can keep them to a minimum. Take time to think about what makes a good fit. Nurture those clients and cultivate more like them by connecting to the people in their network. 
  • Communicate your value. The clients you currently have are ready to grow with you because they have already experienced the value you deliver. However, make sure you communicate that value, articulating the solutions you have provided. Then, when reaching out to potential clients in person or virtually, express that value in clear terms.  
  • Package your services. Sure, you prepare your clients’ taxes every spring, but you have other services to offer year-round. Bookkeeping, tax representation, payroll and financial planning are just a few. Add them to your portfolio and offer them as a package to your clients. That way, you’re separating your fees from the time and paperwork you put into tax-preparation services. 
  • Value pricing. “What’s it worth to you?” It’s a question we often hear. In tax preparation, value pricing pegs fee scales to the value that the customer places in the service provided. After all, few people want to do their own taxes. Through value pricing, you can earn more for the same services you’ve been providing.  
  • Soften your sales pitch. You got into this business because you love solving problems. What you don’t love is selling yourself to new clients. You’re not alone, but there’s a simple solution. Think like a consultant, and learn to have value conversations, sharing with potential clients the exponential boost you can bring to their tax matters and overall financial health.   

Create targeted marketing strategies 

From the time we hold our first jobs, we are all taxpayers. That makes for a deep pool of potential clients, but the pool of tax preparers is also deep. You need to stand out from the crowd. When you build targeted marketing strategies, you attract a client base that helps drive your income upward.  

Consider these four tips to change the trajectory of your business: 

  • Market to a niche client base. Taxes are tricky, and tax preparers who establish themselves as experts can attract select clientele. Consider the many taxpayers whose taxes can be complex. They include sole proprietors, military families, freelancers and gig economy workers, social media influencers, or divorced parents. Perhaps they are insured through health insurance marketplaces or they have a heavy load of student debt. In the commercial realm, there are nonprofits, S corporations, C corporations and business structures that face differing oversight and compliance. Position yourself to serve a specific group, and they’ll see you as the specialist. You can still serve clients outside of that niche, but you can build the bulk of your business by creating trust among a smaller circle of well-paying clients.  
  • Social media networking. Social media is the cocktail hour of today – the place where people with mutual interests gather to swap ideas, commiserate, and provide support. Join Facebook groups, sub-Reddits and other social media spots where people with shared interests congregate. Get to know the group by liking, commenting and sharing helpful tips. Occasionally mention in a quick post that your expertise matches their tax needs. On the business side, LinkedIn messages are a great way to reach out, especially when you notice a wealth of shared connections, which can indicate a good fit.  
  • Work with remote clients. In these days of working from home, no one is tethered to one place. Fortunately, potential clients feel comfortable working remotely, so they can be perfectly happy to schedule video consults with the right tax professional. Splash your remote availability on your website and social media accounts. Let potential clients know that they can streamline the process and protect sensitive information by submitting documents via a secure portal or mobile app.  
  • Offer flexible payment options. Clients enjoy choices, and so do tax preparers. You can establish a variety of payment methods that suit both of you. Card readers allow payment through a simple swipe or tap. Tax bank products simplify the process and eliminate the need for clients to come up with the money upfront by pulling your fee from their tax refunds. You can even acquire bank products that offer your clients the option of refund advance loans so they get their refunds faster. 
  • Market with purpose. Don’t be one of those tax preparers shouting into the wind. Write and implement a marketing plan that focuses on these key elements: promoting word-of-mouth with an “elevator speech” that includes your differentiator, a strong social media presence, email marketing, and direct-mail postcards and flyers.  

Know your value and expertise 

Remember when we talked about packaging your services for year-round income? Let’s take a closer look, because you can boost the value of your current clients by becoming truly indispensable to their financial well-being. 

It’s time to be more than a tax preparer in the eyes of your clients. Maybe they see you as simply filling out forms and punching numbers into a calculator. It’s a service they are happy to pay for, but it’s also a service that a lot of people with minimal training or experience can provide. In short, you are a commodity. Your clients know they can easily find someone to do the same job, and you respond by slashing your prices to compete. 

But what if you were more than a commodity, and your clients knew it? You have education, training and knowledge that they lack. Be an adviser, and they will pay for your insights. Best of all, you have choices in the avenues you can take to generate income from advisory services: 

  • Direct. Meet with clients one-on-one and dazzle them with ideas for improving their finances. 
  • Leveraged. Share your expertise with groups of people, perhaps providing live training. You’re leveraging your earning potential by charging an hourly rate to multiple people within a single time frame. 
  • Passive. In music, songwriters earn “mailbox money” from regular royalty checks for songs they penned long ago. You can make mailbox money, too. Find ways to share your expertise in passive form, such as writing and selling tax guides for taxpayers in your niche market or starting a simple blog embedded with carefully selected sponsored links.  

Package your tax prep services 

Package deal. Bundling. Silver, gold and platinum levels.  

From streaming services to insurance companies, everyone wants you to buy their services in bundles. Why? Because it means less work for more money, while addressing the individual needs of each customer. 

Potential clients love packages because they can choose the option that best suits them. Suddenly, they’re not debating each year whether to continue engaging you but, instead, are pondering how to move forward with you. 

Make the array of choices comprehensive but simple. The magic number of three streamlines your available packages:  

  • Tier I: Many clients have simple needs or can’t afford gold-plated services. Show your appreciation and sensitivity to their circumstances by offering a low-cost, basic set of services.  
  • Tier II: Here are the basics — and more. You’ll know you’ve created the most useful combo when most of your clients are choosing this bundle.  
  • Tier III: Clients with complex needs will pay premium for greater access to you and your expertise.  

Creating packages takes time, but the initial investment delivers strong returns. They include:

  • Improved efficiency. Creating packages forces you to take a hard look at the services you offer. In turn, that scrutiny uncovers possible efficiencies that you can apply to your daily workflow, making the most of your time.   
  • Upfront fees. Clients know exactly what they will be paying you. No surprises. No chasing down clients with unpaid invoices. 
  • Paid in full. Your phone bill covers the month ahead. Your cellphone carrier doesn’t expect payment after you’ve used its service for weeks, so why should you? Packages help you escape the work-now, get-paid-later trap. 
  • Work agreement. Packages articulate the work that you will provide. Clients know what to expect of you, and you know what to deliver. Just be sure to have processes for moving forward on any work needed outside the tier of services your clients choose. 
  • Better communication. Well-designed packages spell out the communications procedures. Clients know how best to reach you and when to expect a response.  

Make the move

You have the power to make more money year-round without putting in more tax-time hours. A few changes to your marketing plan to attract new clients and a readiness to make yourself indispensable to existing clients are the keys to success. Becoming that valued expert demands keeping your skills sharp while you stay current on ever-changing tax and finance issues.  

Surgent Income Tax School offers the field’s premier continuing education (CE) courses. More than keeping you compliant, Surgent Income Tax School’s courses hone your skills and keep you in step with an increasingly complex landscape. Plus, Surgent Income Tax School’s guide on how to start and grow your own tax business covers all the bases for new practitioners and those looking for tips on going in new directions. With Surgent as your partner, you’re ready to take your business to the next level.