How to Recover from the Loss of a Large Accounting Client

What happens when you lose a large client upon which your accounting practice depends?

Many accountancy practices specialise in small and medium business clients simply because they are fearful of putting a lot of time and effort into a large client who may leave them for a larger accounting firm or who may decide to develop their own internal accounting department in the future.

No sensible accounting principal wants to depend on that “large” client for the bulk of his or her fees.

Should something happen to the large client, the lost fee income can create cash flow problems and in some cases bring about the demise of a small accounting practice.

The reality is that a large client will possibly become even larger and eventually require the services of a major accounting firm who has the resources and people available to satisfy the needs of the growing business.   Some large companies relocate to another country or state for business reasons. If their annual fee represents a large part of your accounting practice your business could be affected to such an extent that it would be hard to recover.

If you have lost a large accounting client, here are a couple of tips that may help you recover from such a revenue loss:

  1. MARKET - Learn how to market your practice towards the smaller business clients so that you are more dependent on the smaller yearly income streams and in this way reduce your reliance on any one particular client.  This is a sound move that every new accounting practice should put in place so that if you lose a smaller client it wont have an effect on your bank balance, as much as a larger client.
  1. SHARE - You may wish to consider moving in with another smaller practice so you can both achieve lower operational costs through economies of scale. You will then be able to utilise staff better, as well as equipment, premises expenditure and office services.
  1. MERGE or BUY - You may want to consider purchasing another smaller practice and incorporating its fee base into your own. Or consider merging your practice with another to form a stronger client base and benefit from the combined resources.

If you wish to grow your practice, consider outsourcing your marketing to a firm who can look at generating more leads and new clients for you. 

By following this approach you may find that a steady stream of client leads is generated each week.  The clients that come from this type of marketing can be solid because this prospecting enables the clients to call you instead of you having to chase them. 

You will have to put in place an easy efficient process for screening so you don’t waste time chasing clients who are basically “deadbeats”.

If you cannot do your own direct marketing, working with a specialist firm will bring out inefficiencies in your own processes.  You may need to redo some of your current systems, if they are old-fashioned or require upgrading to meet today’s technology. 

You will find that the ability to pick up bigger and better projects using this type of marketing may be more favourable than you had originally considered.  In fact, if this process is carried out properly you will be surprised at the number of new business clients you can win over by working with a specialist marketing firm.

You may have to attend a specific course in “how to market your accounting practice” to get the full benefits. 

The main objective is to convert your accounting practice into a business, rather than just a job and to ensure that you diversify your client base so you never have to suffer loss again because of a big client leaving.

Whatever strategies you employ, the main lesson to be learnt if you are a new accounting practice, or a small growing practice, is that you must never put all your eggs into one basket. 

It is important to diversify. Continually spread your fee base between small, medium and large clients so that you will never again be at the mercy of one or two large organisations.

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