Starting up an Tax and Accounting practice- feedback required around pricing

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manjeesaccountant.com.au

• 

  Devils Advocate on 08/06/2014 - 13:59

  +4

  Very cheap pricing. Are you sure it's sustainable?

  A few points that I thought of reading your description:

  1. You say you're "providing 24/7 tax advise" (sic). Do you mean that? If a client rang at 3am on a Saturday morning would you take the call? You have to be careful making these kind of statements.

  2. This seems pedantic, but if you want to look professional you have to make sure your spelling and grammar is 100%. Things like advise vs advice and capitalising 'I' is important as it proves you pay attention to detail. You've also got a lot of typos in there, make sure you re-read things a couple of times when advertising your business.

  3. You mention pricing of $60-90 at the top, but $100-$200 down the bottom. Make sure you maintain consistency. If a potential client is confused by your pricing they most likely won't switch to you.

  Sorry if that is a bit harsh, just a few points to improve on.

  • 

    Associatedmanno786 @ manjeesaccountant.com.au on 08/06/2014 - 14:56

    +1

    I really appreiate your honest feedback :) I would rather you point out the flaws in the business plan than marketing it to the client segment and tarnishing the reputation :). As for the 24/7 service we were taking calls upto 11-12 at night because some doctors do late night shifts, we also handled some overseas clients last years where the person was overseas but wanted to get their taxes sorted and thus did provide late night advises and conference calls. I believe you are 100% correct i better not be overly optimistic and should choose my words correctly :) again really appreciate your words and have taken those into account

    • 

      Devils Advocate on 08/06/2014 - 15:00

      Great attitude. If you keep that I'm sure your business will do well.

• 

  StewBalls on 08/06/2014 - 14:23

  +2

  My reviews: if there is a taxloophole named after you that means you are a successfull accountant lol. That doesnt mean an accountant is a cheat.

  Honestly mate, that comment might be some sort of accounting industry in-joke, but have you considered that touting it as some sort of mission statement might actually come across to prospective clients as frivolous & unprofessional. Don't be surprised if the ATO views it pretty unfavourably too…someone there might get the wrong idea and decided to single you & you clients out for more than the usual number of audits to make sure those loopholes you're promoting aren't tax evasion! Just my $0.02…

  Seriously, have you thought about working for someone else for a little while, just to see how they conduct their professional practice?

  • 

    Associatedmanno786 @ manjeesaccountant.com.au on 08/06/2014 - 15:03

    +1

    You are spot on… I would not use it as a marketing strategy and yes you are correct in pointing it out. I am not running it alone that's for sure, i just wanted to get some ideas out from the open and see if we can incorporate them in our business plan. You are correct in assuming that i am a newbie in running such a practice. Yes i might not have the right attitude to market the business :( and that is why i am here. I really really appreciate you pointing out the flaws and i have taken those comments on board :). But i can assure you one thing i have been in the industry well over 8 years. I know accounting and tax and i know i am very good at it. The idea is to leverage my expertise and skills to expand a business.
    Again all your feedbacks are really helpful.

• 

  p1 ama on 08/06/2014 - 18:23

  +1

  Okay, first off, I'm qualified in finance, don't run my own business or anything like that, so nothing complicated with tax. So I don't usually need an accountant for tax purposes, but I'll try my best to answer your questions.

  1- What kind of accountant would you go to?

  An accountant who knows their stuff and can get good tax returns. Also, I think you should position yourself more towards those who have more complicated tax returns. For most people who work 9am - 5pm in a pretty standard office job, there aren't going to be many deductions that they can make.

  You should probably try to aim yourself at people who work and invest heavily, so you can look at things such operating losses on investments and help them offset their taxable income…etc.

  Same goes with small business, a small business' books are far more complicated than anybody who works 9 - 5 and will be much more willing to hire an accountant.

  2- What would you typically pay? For an individual or soletrader's tax return

  The truth is, not much. For someone who works a standard job, tax returns are easy and it's not hard to do them yourself. You'd have to target essentially people who are lazy or time-constrained or target those who actually need an accountant - i.e. small businesses or people who have complex investments.

  3- Would you see an accountant face to face or would you want your taxes done over the email/phone or would you like the accountant come to you?

  Offer all those possibilities, the more you offer, the more people you are likely to attract.

  4- What would take you to change your accountant? I mean there is a trigerring point for everyone? Is it the price? The quality of service? Better tax advise? Quick turnaround times? Etc

  Competency, essentially.

• 

  ShannonIngram on 08/06/2014 - 19:39

  +2

  Regarding your website, it's obviously still a work in progress, but things like the team info definitely need to be expanded beyond "Person X has 8 years experience in…..". The design to switch between staff is hard to see on that background as well and isn't really intuitive for me at least. The lack of office addresses and the only contact being a mobile number doesn't necessarily inspire confidence either. Even a virtual/serviced office (like Servcorp of the like) would be preferable to having nothing specified.

  As a small business person myself, I would be hesitant to switch accountants. I feel my current accountant understands my business goals and spends enough time with me tax planning etc and actually adds value to my business. I don't think this would be applicable if he only charged $90 to do so and also if we didn't take the time to catch up face to face and build that connection. I don't feel that my needs are overly complex but $90 would just not make a sustainable business for you for the level of care that I would expect from my accountant.

  I personally believe price is a bad way to compete as an accountant (although that may not be a popular opinion on this website!!). From a quick google there are places doing "internet assisted" tax returns for as little as $40 - so there is always going to be someone out there cheaper. I send a good few referrals to a few different accountants in the course of my work and when I do so it is on the basis of their expertise and willingness to help my clients that I do so. The ones that I do refer to are very clear on what their target clients are (eg. one is purely targeted at investment properties, another is an SMSF accredited expert and another purely wants small to medium businesses whilst the final one sees himself as each of his clients companies CFO's and only targets big business).

  Hope that helps - good luck with the new venture!

• 

  dunnygate on 08/06/2014 - 20:29

  +1

  This is an interesting post, as it is something that I am interested in.

  I often wonder about accountants/tax agents, and have people say I've seen sandwich board signs "tax returns $50, etc" and people say if you pay anything more that you are a mug. I guess in a way you get what you pay for.

  Your post was full of spelling and grammar errors, but that could happen to anyone and I try not to judge people on these things, but there were so many. People really will judge your professionalism from this and you're dealing with people's finances here.

  You claim many things, like finding loopholes, making claims to get people $1000 or more? refunds, deductions? Like another poster mentioned above, many PAYG employees simply won't have deductions like this, also comparing your services to another accountant or practice, or disparaging any other accountant is a big no no you're breaching the Tax Agents Services Act 2009 and thus more than likely any professional code of conduct, if you are a member of a professional accounting body. Which brings me to my second point.

  Your website isn't that bad, but when I click on the "team" profile your also breaking the rules, firstly half of your staff seems to be associate members, but you claim they're "CPA Assoc", this isn't true and is misleading, you're trying to make them look like they are voting CPA members, the correct title for an associate CPA member is "ASA" and "ASA" only.

  I tried to find half of your staff on the Tax Practitioner's Board registry, but they don't seem to be registered tax agents, nor does your businesses in itself.

  Thirdly, don't undercut the market, some people may be happy to pay for a half service which may lack some of the competence of a genuine tax professional, but you're only hurting yourself, well yourself and the industry.

  I'm very happy that others have said that you are too cheap here and that they prefer a quality service rather than a budget proposition.

  I don't mean to attack you, but you're really not helping yourself, I know plenty of very qualified and experienced people who don't go the public practice route that you are taking because they are scared that they're unable to offer their clients a competent and complete service and then I see things like this happen. But from what I can see here they would offer an exceptional service. I think with you it is the other way around, much bravado, but not much experience or knowledge to back it up.

  I wish you well, but start by reading up on the codes of conduct and getting your own business in order before you start playing with other people's lifes, it isn't you that will be paying their big penalties and fronting up to court because of errors that you have made.

  Good luck.

  • 

    SaberX on 09/06/2014 - 16:10

    i agree with dunnygate. There's a huge difference between being chartered and an 'associate' of a body. I was an associate CA member just by being a student and 'registering' with the institute. If not misleading, then that aside it has no weight at all (which is why unless you're a mug, I would think it only serves to mislead the mugs).

    Agreed with the typos etc - we can't judge, but if that's how you normally converse then you may need to reconsider your professional approach.

    Your prices for a tax return are cheap, way too cheap. How will you make money? Will you have enough to 1) pay staff, 2) licensing fees for software that you'll use 3) rent ? assuming your not working from home and lastly 4) paying yourself?

    You get what you pay for , but with an accounting firm a basic individual ITR takes hundreds of dollars, sometimes thousands when you involve rental schedules, investments, reconciling interest etc. You can skimp on this with no firm structure so that no manager reviews the accountants work before a director does, by doing the work solely by yourself. But still, at under $100 for an ITR are you going to finish each return in less than 30 mins, or else pay yourself less than $100 an hr? Most graduates in an accounting firm start off at over $100 an hr, i dont see any being less than $80 besides vaccies and interns. So keep that in mind.

    If anyone has anything that could be done in sub $100 in my mind they must be so simple that they could etax it - and if so then they are either people completely clueless or plain lazy to do their own etax?

    Just my 5 cents.

    • 

      Peck on 09/06/2014 - 16:23

      +1

      "If anyone has anything that could be done in sub $100 in my mind they must be so simple that they could etax it - and if so then they are either people completely clueless or plain lazy to do their own etax?"
      Not an opinion even worth 5 cents in my opinion.
      Question 8 on tax return………death benefit…..blah ..blah…."If YES put N in the box". Whilst the Tax department does things such as using N for YES and not Y, it is very easy to stuff up a return, and put yourself into thousands of dollars of debt until your amendement is processed (50 days stipulated to process mail amendments where it is your fault )

      • 

        SaberX on 10/06/2014 - 10:55

        peck, we as people need to take some responsibility for some everyday things. if an instruction says "If YES put N in the box" and you can't work out to put an N there for a yes, even though you do have a point it sounds stupid and nonsensical, but this is a pretty much straightforward instruction.

        I'm not talking about tax law or treatment which requires someone with experience or a working of accounting and tax, but following simple instructions.

        Like I said, the majority of people who have a return under $100 that have to get it done by someone are just too lazy to do it, or are not as great in working these simple things out. It is probably akin to calling IT out for something basic on your computer that you could work out yourself.

        Anyway the main point is - at under $100 a return can he make a margin? And I think it may be hard.

      • 

        p1 ama on 12/06/2014 - 11:29

        If you're stupid enough to get confused with those instructions, then you really deserve to be put into thousands of dollars of debt.

        There are lots of other things in life that are more confusing.

• 

  Peck on 09/06/2014 - 09:23

  I would love to find a Tax agent in Sydney willing to do a face to face, simple tax return for under $100.

• 

  ilostnemo on 12/06/2014 - 13:55

  Your established clients are your best marketing tool, maybe a referral bonus ie they receive 15% of their return for each new sign up.

  I wouldn't change and use you, for one reason, I don't know you, I don't know if you are good etc.

  However if I was recommended by someone I knew, I could be persuaded.

  Good Luck.

• 

  Associatedmanno786 @ manjeesaccountant.com.au on 30/07/2014 - 16:27

  I have re visited this page again and I am really surprised by some of the comments people have posted here.

  I do appreciate people taking out time and energy to show some care and evaluate my approach. I do agree to a lot of things said here and let me put my views out there as well.

  1- spelling mistakes, I admit I made some, but they were because I posted this without thinking/rechecking and that too using my iphone, I guess Iphones are not built for my fingers. Yet I shouldn't shift the blame and yes I will be much more careful in the future.

  2- Pitching at under $100 is because we have managed to keep our fixed low. We are presently running from three different places (two in Melbourne Glenroy & Truganina) and (one in Sydney- westmead). We almost pay zero dollars in rent.

  3- I sincerely believe in business from word of mouth and thus most of our client base is from referrals (which I love). Please do have a read at our profile on womo.com.au (word of mouth online). We value client feedback and offer discounts to clients who are keen to help us spread the true word. It doesn't have to be good or bad, just the truth about the service you experienced.

  4- We have setup a referral program where a client gets 5% off for each successful referral which would stay on their profile with every service they use from us. We publish our rate list to our existing client list every year because we believe we should act in the most transparent way.

  I am no sales person and I do not know how to sell myself, but what I am good at is accounting and taxes, thus what I offer is zero charge if a person is not happy with the service we offer. We offer obligation free estimated tax returns which helps client to understand our value proposition.

  Thank you all for the wonderful feedback and critics :) I will keep this going and update you all at the end of the season.