I spoke to a group of accountancy firms earlier this year, and it was wonderful to meet so many driven individuals who are so committed to the growth of their own businesses and their clients.
One of the things I talked about which really resonated with the audience was about how Accountancy Firms are serving their clients Plain Waffles (occasionally with ice cream) and how this is costing the firm and their clients dearly, creating a lose-lose situation.
Let me explain (because this is an important concept.)
Each year I get to speak to thousands of accountancy firms around the world, and the majority of them get stuck in what I’m now calling the WAFFLE TRAP.
They’re stuck providing compliance services, which is not a problem in its own right, after all, compliance services are still THE most profitable work we do in our firm.
But they’re charging low fees for those compliance services and finding that prices are being driven down even further by their competition.
But this in itself is NOT the trap.
It’s what they then attempt to do next to get out of this situation, which is where they get caught (the Waffle Trap).
So they listen to me explaining how in our accountancy firm, we have a minimum monthly fee of £500 ($800 a month) and how in August this year, the average fees of our new signups was nearer £900 ($1,400) per month because of the value we’re delivering to those clients.
I then go onto explain how our Platinum Clients are investing upwards of £2,000 ($3,200) a month with us, into the finance function of their business.
I openly outline the systems and processes we have in place to achieve this and give example after example of firms who have increased their revenue by 30% within 3 months, or doubled, tripled and quadrupled fees with their clients, to the extent their clients actually love their new higher level of service.
But it’s in their attempt to implement these systems, processes and strategies and pull away from where they are, that they can fall into THE trap….. and this brings us onto WAFFLES.
Waffles With Ice Cream
So most accountancy firms are providing the equivalent of Plain Waffles to their clients.
And what would you pay for Plain Waffles? $5?
The client consumes these waffles, but don’t really value what they’re getting.
So in an attempt to increase the value, the accountancy firm attempts to add ice cream to those waffles and sell them for $7 lets say.
But STILL the client doesn’t value what they’re getting.
So they end up in sales discussions, bartering over the price of the ice cream, attempting to position the value and in the end, conclude that they’re just stuck with a load of bad clients who don’t value what they do and are not willing to pay for anything other than a plain waffle.
So what’s the point? Let’s not bother trying to sell the ice-cream. These strategies just don’t work in our town, or with our clients, or with our staff or with whatever other excuse they clamber for.
So they either offer the ice cream for a lower price, which puts them in a worse position than before. Or they revert back to what they were doing and charging before.
But this was never an issue of waffles.
The real problem was that they didn’t offer ENOUGH.
And this is where they get caught in the WAFFLE TRAP.
Most accountancy firms don’t charge enough, to be able to provide the level of service that people are willing to pay for.
The Waffle Trap
The Waffle Trap is dangerous zone where the accountancy firm tries to offer MORE, but not ENOUGH.
Because the only way to provide ENOUGH, is when you start selling $15 waffles.
Now I’m currently sat in Abu Dhabi airport waiting for our connecting flight back in the UK. and I’ve attempted to illustrate this on the back of our flight itinerary.
The Waffle Trap is where accountancy firms dip their toe into a new method of pricing and selling their services, only to discover that offering slightly more doesn’t work, so they retreat to their Plain Waffles, only more jaded than before.
The TRICK….. is to push THOUGH the Trap and to get to the point of offering $15 waffles….. and beyond.
$15 Waffles & Beyond
On our first day in Brisbane, my wife and kids got up extra early (still jet lagged) and so we headed out for breakfast.
We found this great little place hidden away and my son Leo quickly gravitated towards the Waffles on the menu.
What arrived, was the breakfast to end all breakfasts. Not from a health point of view, but from a OMG-I-didn’t-even-know-breakfasts-existed-on-this-level point of view.
THIS….. is what arrived…
It was waffles served with fresh fruit, meringue and raspberry ice cream, rose-scented candy floss, edible flowers and raspberry sauce.
It was ridiculous.
THIS is what a $15 waffle looks like and THIS is the waffle I photographed and have talked about ever since.
THIS was a waffle which they did charge enough for, to be able to provide the level of service that I WAS willing to pay for.
But they could only provide this level of service BECAUSE they charged $15 for it.
This is precisely why we have a minimum monthly fee of £500 ($800), because we want to serve the rose-scented candy floss and edible flowers. Only for us in comes in the form of Video Management Reports and Monthly Progress Meetings.
If you’re fighting over the scraps of £100 – £150 a month ($160 – $240 a month), you’ll never be able to provide the level of service which people are willing to pay for.
But if you’re prepared to push through the Waffle Trap, you can really start to create win-win situations for you and your clients, doing the work you love and which your clients value.
Want To See What We Charge For Our Waffles?
If you want to see what we charge in our accountancy firm here in the UK, or what our friends at Change Accountants charge for the equivalent in Australia, then sign up for your free trial of GoProposal by Sage. It comes preloaded with all of our pricing for you to edit and amend and you’ll quickly see what a $15 waffle looks like.
If you’re already a GoProposal member, then please share your stories of how you escaped the Waffle Trap below 🙂