How Different is Your Firm – REALLY?

CPA firm partners have never been accused of being marketing geniuses.  While many understand the importance of differentiating their firm from others, few can execute – actually explain what sets their firm apart from others.

Recently, a small east-coast firm engaged me to merge their firm into a larger firm.  After an initial screening, we called a few firms in for a round of face-to-face interviews.  The two partners did most of the interviewing with me in attendance.

One of the firms invited was a very successful, reputable and profitable firm.   Its MP spent 45 minutes very articulately and passionately describing his firm, their capabilities and how they were organized.  My client fired one question after another to this firm and received eloquent responses.

Then came crunch time.  It was the bottom of the ninth and the bases were loaded. The MP had a shot at a grand slam.   My client asked:  “What differentiates your CPA firm from other fine firms?  What makes you special?  Why should we merge with you instead of another firm?”

He was speechless.  The proverbial cat had his tongue.  The look in his eyes said  “Help.  I don’t have a clue how to answer this.  I’ve just lost the beauty contest!”

After the shock of the question wore off, the MP proceeded to mumble things like:  “Our people.”  “The quality of our work.”  The commitment we have to our clients.”  “We have low staff turnover, which shows how much people love our firm.”

Of course, everyone sitting around the table thought the same thing:  “Wouldn’t EVERY CPA firm say the same about themselves?”

The MP didn’t or couldn’t give a good answer.  Unfortunately, he struck out to end the game.

I’m sure many of you reading this are familiar with the Practice Development 101 drill of memorizing how to  respond when an unexpected opportunity to pitch your firm presents itself.  However you do it, do it in a way that shows how your firm is different.

In defense of the flustered  MP, it’s hard for most firms, especially those under $10M in annual fees, to differentiate themselves from their competition.  Hundreds, perhaps thousands of these firms are profitable, are brilliant accountants and enjoy stellar reputations.  But they remain hard-pressed to set themselves apart  from other firms.

The honest fact is that there are many more similarities than differences among competing CPA firms.  The vast majority can be described by ALL of the following:  Profitable, knowledgeable, high integrity, generalists, partners have 30+ years of experience, etc.

So, what’s a firm to do?

It seems to me there are two choices:

• Find ways to be different.  It’s hard but by no means impossible. Here are a few examples I hear from my clients:  (a) We specialize in XYZ industry. (b) Starting at an early age, our staff are required to teach technical accounting and tax courses because we feel that when you teach something, you have a better understanding and command of the material.   (3) We guarantee client satisfaction – if you are not completely satisfied with our performance, we’ll refund your fees.  (4) We are committed to developing a strong bench – a big part of the compensation to our partners depends upon their proven excellence in mentoring specific staff under their supervision.

• Bite the bullet and be honest.  “We know our firm is one of the best CPA firms in the market.  But honestly, there are other very fine firms out there.  We are friends with many of them.  I don’t expect you to believe me when I brag about my own firm.  Most clients hire us because of one or both of these two reasons: (a) a recommendation or referral from a credible source and (b) a sense that there is a good personality and cultural fit.  I would like you to visit our office, see how we are organized, meet some of our people, talk to some of our clients, talk to our bankers and our attorneys.”

So, make sure you have a story to tell the next time you meet someone in the elevator or at the dinner table at a wedding reception or a cocktail party for your alma mater.  Follow the Boy Scout motto:  Be Prepared.

Identifying what sets your firm apart from the competition is critically important to the strategic planning process.  This step and dozens of other pointers and suggestions are addressed in our monograph Strategic Planning and Goal Setting for Results.