The Ambitious Bookkeeper Podcast

When Will I Be Ready for Advisory?

April 19, 2022 Serena Shoup, CPA Season 1 Episode 45
The Ambitious Bookkeeper Podcast
When Will I Be Ready for Advisory?
Show Notes Transcript

You’re most likely already offering some level of advisory and either not aware or not confident enough to charge for it. And if not... In this week’s episode, I’m going to answer the question “When will I be ready for advisory” and give you some ideas of things you could offer.

We cover:

  • what is advisory?
  • why would you want to offer it?
  • how will you know you’re ready?
  • what do you need in place first?
  • where to go to learn?

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[00:00:00] You're most likely, already offering some level of advisory and either not aware or just not confident enough to charge for it. And if not in this week's episode, I'm actually going to be answering the question. When will I be ready for advisory? And I'm going to give you some ideas of things that you could offer. Packaging these services into offers is something I cover inside of the bookkeeping business accelerator and with my private clients. So if that's something that you want to dive deeper on together, Reach out to or shoot me a DM on Instagram. I'm at ambitious bookkeeper. Now let's get into today's episode


[00:01:10] First, I feel like we need to ask the question or answer the question: what is advisory? I honestly believe it's anything above and beyond the basic compliance needs of the client. So, what do they find value in that is strategic in nature and more forward looking. It could encompass a whole lot of different things like cashflow forecasting, budgeting, break even analysis, kPI tracking app consulting. Strategic planning, which would be like goal setting or KPI setting things like that. There's so many things that could be considered advisory and you honestly might not even know until a client asks a question. 

[00:01:56] For instance, one thing that comes up a lot with clients is like, when will I be ready to hire? Like, can I afford this? Any of the, can I afford this type of questions? Is it's an advisory situation. Because it's going to require you to look back at history and also think forward about things that are coming up. And have a conversation with the client. So most advisory type of stuff you cannot really advise on without the full picture. And so it always requires a conversation with the client. 

[00:02:30] Now, why would someone want to offer advisory besides the fact of so many people in our industry think that bookkeeping is a commodity and advisory is where it's at and you have to get into advisory if you don't want to basically just disintegrate as a business. I'm I'm saying all of this with tongue and cheek, because I do still think that there's a ton of value in bookkeeping. There are lots of business owners that value bookkeepers and not everyone sees it as a commodity. But you may still want to offer advisory services if you have that kind of background or it's something that lights you up. 

[00:03:16] It would give you the ability to charge more. Create more impact for your clients. And more satisfaction in what you do for clients. You will be co-creating results with them instead of just reporting on what has happened in the past, or keeping records purely for tax purposes. Not all clients will want or think they need advisory level services and that's okay. And not all of your clients will need to engage you for this. And that's okay. So how will, you know, if you're actually ready to be offering quote unquote advisory? Here's a few indicators that you might be ready. If you are feeling like you've hit a plateau. In the services that you're offering. 

[00:04:01]  And the clients that you're attracting, if you aren't feeling challenged in what you were working on. If you're wanting to grow intellectually and skills wise. If you want to have more impact with clients and you see opportunities that your clients might not even be aware of when it comes to their numbers. 

[00:04:20] And you know that your clients aren't using the financials that you provide them to make business decisions and you know, that you can help them. 

[00:04:30] Those are all really strong indicators that you might be ready to start dipping your toe into advisory. 

[00:04:36] Now, what do you actually need to have in place before you can move forward with this? Number one, you want to have a client that you can practice this on. And I, I say practice on like, whether you're including them in this initially or not, you can still practice on the client behind the scenes and teach yourself and learn. 

[00:05:00] If you have an idea of a certain client's pain points and you want to help solve them, that's a good thing to have in place of having any idea of their pain points. Being analytical and forward-thinking, having the ability to see patterns and think strategically is going to be very, very helpful for you to have in place. So if those are not something that you feel is a strength of yours, it can be. I do believe it can be learned. It might be a little more difficult. You might take you a little more time, but I do think that you can learn to be analytical and think have a more forward thinking mind. 

[00:05:43] You definitely need accurate bookkeeping. And the ability to review the reports and spot errors. So that you aren't the one doing all of the work and delivering the advisory services. It is really hard to be in the weeds and also strategic from a bird's eye view. That's why a lot of firms that do offer advisory will either have a completely different team doing the bookkeeping either internally or an external firm. And then they just handle the CFO advisory type stuff. Because when you are doing both, it is really hard to take off the I'm in the weeds technician hat and then put on the strategic advisory role. 

[00:06:30] When I started transitioning over into doing the higher level stuff. I had a hard time, like sitting down and being like, okay, now, like the books are done. I'm going to go ahead and do the, You know, The cashflow forecast or whatever it is. And then I would start pulling information for that and then realizing, oh, I need to like look into this and I need to do this and tidy up this other thing. And I would just get kind of lost in the weeds instead of working on the advisory type stuff I was wanting to work on. So it is probably something you want to start thinking about having another bookkeeper on staff that you would just be reviewing their work and they would be handling the actual work. 

[00:07:14] And then lastly, your ability to communicate ideas to clients in a simple, clear manner and without being condescending. It will go a very long way if you are kind to your clients and clear and not condescending. I believe our profession has An overarching issue with making clients feel crappy about the way they talk to them. So I hope that's not you I'm, I'm guessing it's not because you're listening to my podcasts. We do things a little different around here. 

[00:07:49] Okay. So what are some advisory services you can offer? I kind of talked about them earlier, but cashflow forecasting, budgeting, KPI tracking. App consulting strategic planning like goal setting and figuring out which KPIs are important to the business owner and offering a breakeven analysis. So let me give you an example of a couple of these. So a couple of really simple ones are the cashflow forecasting, which always entails again, most of these, all of these entail a conversation with the client because you need to figure out what's important to them and what they value and where they're headed. So. In strategic planning, you have to sit down and have a conversation with them about their goals, about how much time they want to spend in the business and how much money they want to bring home so that you can back into what the strategic plan is going to be. 

[00:08:45] For a breakeven analysis. This is really helpful. For, especially we'll really for any business owner, but what's coming to mind right now for me is brick and mortar. So I have a couple clients who are opening a storefront. So it's really important for them to know like what they're striving for as a daily revenue number in order to cover the bills for the storefront. So. You want to gather basically all of the operating expenses to have that store open and figure out now what is their daily revenue supposed to be in order to hit that? And, and cover everything and pay their employees and things like that.

[00:09:30] I also offer this to all of my clients really is like, Especially if they are. Trying to just kind of get to a point where. They know what their minimum needs to be. And we'll, we'll show them, okay, these are your operating expenses that are like, non-negotiable you have a contract, do you have to pay this. This is, you know, like your software and the things that it, that you need to run your business, you tally all that up, and then they know what their break even is. And then you include what, you know, what they want to be paying themselves, and you add that 

[00:10:06] Cashflow forecasting is really important for, you know, especially those businesses that have uneven cashflow. And launches. They need to know how long the cash they have is going to last them based on again, you will have to know your breakeven point, so that they know how far they can make that cash last if they are spending the minimum. Amount. 

[00:10:31] Now. I know there's a lot. I don't know if there's a lot, there are some programs out there that teach you how to sell advisory, but don't actually teach you how to deliver it. And that's probably because a lot of the delivery depends on what the client actually needs or values. So it all plays into that initial. Value conversation that you have with a client when you're getting to know them and you're learning their pain points. You can offer them different advisory services that are going to address their pain points. 

[00:11:06] Most business owners have very similar pain points like they want to bring home more profit, make more money. Or they want to have more time back in their day. So with the two of those, you can kind of figure out. Well, if we figure out what your breakeven point is, and then start talking about like how you can address your pricing to achieve that easier, or think about bringing in more clients or customers. You're starting to have strategic conversations with them and being in more of an advisory role. 

[00:11:42] The more you analyze clients' financials, the more familiar you're going to get with their trends in their industries. Especially if you niche, this is something that I love having so many clients in one general industry, because I don't necessarily have to go and do industry research because I have it at my fingertips. I see the margins that the rest of my clients are making, so I know what is literally normal for clients in their industry and in their revenue range. So once you start to kind of narrow down in that regard, you're able to have a conversation with your clients of, Hey, Since I work with so many other clients that are in your industry, it appears that you actually have a better profit margin than most everyone else, or maybe your profit margin is a little lower or not as great as what I'm seeing across the rest of my clients. So then you can have the conversation with them of like, how do you think we can make that better? Maybe we should look at your pricing. Maybe we should start putting more offers in front of more people. Things like that. And you'll be able to give them really valuable feedback on their numbers and what they mean and how, like I said, how they compare to the industry. 

[00:13:02] There's also tools that provide some of that industry benchmark data for you live plan is one of them and profit since. We use live plan. I don't use it for industry benchmarking because my industry that I work with isn't really, it doesn't really have its own code. So I do industry comparisons across my clients. But live plan is more affordable than Profit Sense. And there's not as many benchmarking points that they have available as Profit Sense does. 

[00:13:33] But if you know that you're ready to take things to the next level with your clients and this, all of this is kind of resonating with you. Like, yeah. I, you know, I am kind of already doing some of that stuff or I, I do kind of know some of those things about my clients. If you're ready to take things to the next level, even with just one client, but you aren't really sure where to start in building your confidence to be able to package those advisory services. I would love to invite you into working with me on a deeper level this summer. We are calling it the Elevate Summer Sprint. And it's going to help you become a collaborative CFO or controller. And elevate your skills and client experience. And we're going to do this in just four weeks together. The sprint begins July 5th. So it's after the July 4th holiday, we are going to hit the ground running with weekly calls where I teach and we implement together on the call. So there are a couple hours long. It's all going to be live in this first cohort. 

[00:14:39] In the four weeks I'm going to be teaching in week one, how to review your team's work, AKA the bookkeeping so that you're confident in the data without having to do it all yourself. So this is just this one week is going to be so valuable for you, even if you don't. I end up offering advisory services, but you want to start removing yourself from doing all of the technical work in your firm. This is going to allow you to start stepping away. You have to be able to know how to review your team's work without having to sift through every transaction. So I'm going to show you how I do this inside of my firm. It comes with a resource called the balance sheet cheat sheet. Tongue twister who named it? That that's ridiculous. 

[00:15:29] Okay. And then in week two, we are going to work on. Teaching you how to interpret the financials and pull out the KPIs that matter for pretty much every business owner. And how to prep for your client meetings. I'm going to give you the KPI guide resource. So these are all the KPIs that we point out to all of our clients each month. 

[00:15:53] And then in week three, I'm going to show you how we compile and present the financials quickly and easily. So clients understand and don't get overwhelmed. Again, those KPIs are crucial. For this. And the bonus resource for this is the monthly financial summary email template, where we summarize the financials in bullet points in an email, because we all know our clients don't actually look at their financial statements. Okay. But they still need the information that they would glean from them. So that's where this comes in. 

[00:16:27] And then in week four, I'm going to help you guide your clients into better habits, making better decisions from their numbers and become that collaborative controller or CFO that they need. I'm going to be giving you the five minute financial script. So I've talked about my five minute financials videos that I do for my clients. I'm pretty sure I've talked about them on this podcast a couple of times. I'm basically going to give you how we put those together and the quote-unquote script for them. So basically a checklist of the things that you need to point out to your clients in a five minute video. And I'm also going to be offering a group Voxer channel for the four weeks so that you can ask questions. In between calls. 

[00:17:16] So you are getting a lot of touch points with me and others in the group. It will be a small cohort I imagine Of people who are ready to elevate. So this is how it's going to work. I kind of briefly talked about this, but we're going to work through the weekly content in a live teaching workshop format once a week. I want you to set aside two hours for this live workshop to get hands on teaching and training. This is going to be like working inside of my firm and having access to me, guiding you through training in a process. You will bring one client file that you're going to work on throughout the entire summer that you know well, and you're going to work on this for yourself. You could use your own file if you want your own bookkeeping, if it's complete and done. But I, I think it's really good to use an actual client file. You're not going to be sharing this with anyone. This is for you to learn on, but the bookkeeping needs to be complete for at least six months. The data needs to be clean. And it's helpful if you understand the client's industry fairly well. 

[00:18:24] During the workshop, I will be teaching a lesson and then we will workshop on a demo client while you follow along with your own client's file. And so you can ask questions as you work on things. I'll be teaching in whichever software is the most common among the group. So whether that's zero or QBO, depends on who all joins this cohort, and which software is the most common. And then we'll also be utilizing Excel or Google sheets. And the live plan. Live plan has a free trial for like 90 days. So you don't have to commit to that. You will get access to the replays for life. And like I said, this is going to be a very special, small cohort to test out this format extract my knowledge so that more bookkeepers and accountants can serve their clients better. 

[00:19:17] We all know that our industry has dried out antiquated ways of teaching. If you've ever attended any type of CPE course, but you know, I will teach my genius from my days as a controller in a hybrid finance role where we did handle budgeting and forecasting, as well as reviewing and Presenting financials. 

[00:19:41] So I'm not going to make you feel stupid. I will make sure you have a solid foundation for growing your team and or providing these quote unquote advisory services. This cohort is reserved for very serious, but fun people who are willing to do the work, make the time commitment and elevate your services. 

[00:20:02] So if this is something that you're interested in, please head over to ambitious and click the button says reserve your spot now. Or you can click the link in the show notes. They will be linked below. One of these spots is yours. If you are feeling called to elevate, I would love to have you inside. 

[00:20:23] So I hope this episode was helpful for you. Again, we are always. For the near future. I shouldn't say always, I guess things can always change, but right now I am running a contest on every podcast episode. So if you listen to this episode, when it goes live, please, please, please screenshot the episode. Tag me at ambitious bookkeeper on Instagram at Serena Shoup CPA on Facebook or I don't know if you can tag people. I guess you could tag me on LinkedIn. You could share it on LinkedIn too, but I want you to share the episode. Type something, some big takeaway or action item that you are taking away from the episode. And share it to your Instagram stories tag me and I will enter you into win the workshops bundle. 

[00:21:17] So the workshops bundle includes the last round of the bookkeeping biz workshops. It includes a 10 99 workshop and a sales tax workshop. Normally all of these are bundled for sale on my website for $79. But if you win, you get it for free. So I love if you did that. And of course, I always, always appreciate any ratings and reviews on the podcast so that this can get into more podcast players in front of more people. So that we can begin to change our industry for the better. Okay. I'm counting on you to share this. And I hope to see you this summer inside of the Elevate Summer Sprint. Talk to you next week.