Is Your Bookkeeping Business on the Road to Success?
What is your connection to bookkeeping? Have you worked as a bookkeeper in a company job? Maybe you have “kept the books” for Aunt Jan, neighbor Joe, or for the lemonade stand down the street. Whatever the background you know you will be working with various numbers in different layouts, columns of numbers, and additions and subtractions. The person who has helped the neighbors or relatives, let’s call her Sally has a long way to go before transforming her dream into the reality of a successful bookkeeping business.
The other end of the qualification spectrum of knowledge about bookkeepers is the person who has worked at ACME Manufacturing Ltd. as the full charge bookkeeper. Let’s call him Fred. He decides that working from home would be ideal so he could care for the couple’s six-month-old child. After all, his wife’s career is moving ahead has as a lawyer at Dewey, Cheatem, and Howe. (Yes, you should be laughing or at least smiling at that firm’s name.) So, the freedom from a set schedule and the chance to be at home is compelling.
When Sally and Fred think about starting a bookkeeping company, they realize they must know the basics about accounting. For Fred, it is a no-brainer. For Sally, she knows she must study and even take some classes before she is ready to start on her own. Here is what Fred knows and what Sally must study to learn.
Briefly, building owner equity is the goal. This will grow when the expenses that flow out of the business are less than the revenue that flows into the business. It really is that simple. As Fred knows and Sally will soon learn, all the transactions that are recorded will impact owner’s equity. The revenue, expense, and profit (increase equity) or loss (decrease equity) are presented in the Income Statement. Read the vertical dimension of the diagram.
The horizontal dimension of the diagram indicates that as assets pour into the company the equity increases. In a similar fashion, liabilities (or obligations for the future) decrease the equity of the company. Again, the goal is to have more assets in the company than liabilities so the owner equity is a positive number.
So now Fred and Sally feel satisfied they are knowledgeable and ready to begin their new bookkeeping business. This is the common thought process when someone dives into the excitement of their new business. However, this is only half the story. And actually, the lesser half of what they must know before beginning the new bookkeeping business. This is important to realize if the goal is a successful bookkeeping business.
At this point, we can introduce Betty. She has a bookkeeping business but is frustrated when a client leaves and her revenue decreases accordingly. Now we have three people who must be introduced to the next and most important diagram. Why is this? All three of our characters know both the basics of bookkeeping and the required attention to detail. What is left? THE CUSTOMER. There is no business without customers. Most often, people dive in with a sense of confidence in their knowledge of the technical aspects and totally ignore the most important element to their success, how will they attract paying customers.
Now it is necessary for Sally, Fred, and Betty to each dive into the most important part of building their bookkeeping business. To do that, let’s unpack the three sides of the Marketing Triangle.
To start this process, we should begin with the base — understand your market. And if Sally, Fred, and Betty want to be successful it cannot be “anyone who needs bookkeeping.” It is virtually impossible to build a focused marketing effort without a clear definition of who the market is composed of. It can be defined by geography, any small business within zip code 12345 for example. It could be defined as chiropractors who treat high school athletes. It could be defined as businesses with revenue between $2 million to $5 million annually. Or maybe defined as businesses that want to be acquired within two years. It is important to know who you want to serve and to match the specifics of your expertise to the chosen market. Without developing niche expertise, it is very difficult to build a strong and focused marketing foundation.
After the foundation is established the media becomes easier to know what to focus on. If it is geographic centered the media choices can include both online and offline media sources. The target location is clearly known. For non-geographic clients target various social media. Ad sources that can be used including search and interruption ads. The targeting offered by Facebook, Instagram, Google, YouTube, Quora, and LinkedIn can be used to identify almost any defined target group of prospects.
The message for the targeted prospect becomes easier to develop and refine as the expertise of the bookkeeper becomes deeper in the targeted area, geographic or non-geographic. Copywriting skills can be developed through classes or online courses. It is also possible to find freelance talent to assist with developing compelling messages that will attract the exact prospect which will strengthen the bookkeeping firm through a long and profitable relationship.
Conclusion:
To have a successful bookkeeping business, remember that the technical aspects, though important may be the lesser half of the success equation. There is no business without customers and customers come through successful marketing.
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