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How a Small Business Owner Survived in Tough Times

by Ebere Okoye on February 11, 2011

Floating
“An inner quality that many entrepreneurs say helps them survive is optimism.” ~ Jean Chatzky

What I do

My small business is the wealthbuildingcpa.com. My clients are mostly individuals, small business owners, and real estate investors. My services include tax preparation, asset protection, small business coaching, audit representation, retirement planning, bookkeeping, etc.

I also had a consulting contract which was terminated late last year, so I was forced to focus full time on my business. I was very worried and scared. But I prayed, stayed calm, and implemented some new strategies.

I had to do this not just to stay afloat, but  to generate more revenue to support my family since I did not have the consulting contract any more. Here’s what I did:

1. I conducted a financial review of my business

Staffing: I decided to cut down on staffing. I hired an assistant who is very good and able to multi-task. As a result, I did not need as many employees as I usually had.

During the tax season, we hire about 6-8 employees. This past tax season, I only hired 2 people. In addition, I partnered with another tax preparer who is bilingual, which turned out to be a win-win.

He prepared tax returns for all my Hispanic clients, and I reviewed and transmitted all his tax returns. We shared marketing costs, I saved on software and employee costs, and he saved on transmission costs.

Vendors: We shopped around a found a new vendor that was willing to sell us the same software we always use for about 60% off.

They recouped their fees by charging our clients directly. And since I split costs with my bilingual partner, I saved over 80% on software costs for 2010.

Rent: Our landlord was not willing to negotiate on rent. So we started looking for new office space. When she realized that we were serious about moving, our landlord cut down our rent by almost 30%. Be willing to ask for what you want.

2. I tapped into new business

This isn’t just about increasing direct marketing or cold calling efforts. There are unique ways to find customers you normally wouldn’t attract.

Complementary or partner services: I partnered with a local investment groups and was able to bundle my CPA package with their existing packages. Together, we created an ad that shows how we complement each other, and this was a tremendous success. I took advantage of the recognized names in the investing industry.

Join organization or present papers: There’s nothing like expanding your customer base by letting others know you are the knowledge expert.

Since my area of expertise is in wealth building through tax planning, entity structuring, etc, I signed up at conventions, conferences or organizations to offer some advice free in exchange for advertising directly to the participants.

With these speaking engagements, I picked up quite a few clients.

3. I grew my existing business

Ask for referrals: Since most of my customers are happy with my service, they were more than willing to refer my services to their family and friends. With each referral, they also received discounts.

The biggest referral system we have is to refer 3 people and get free tax preparation. It worked!

Provide discounts: It’s cheaper to keep a customer than try to find a replacement one. It is also better for me to make something more than $0. So I never turn down a client because of fees.

I always give room for discounts and most times, I let the clients choose their discounts. I found out that 80% of the time, their discounts were not as high as what I would have offered.

We now offer a “Name Your Price Tax Preparation” special, where clients can literally pay what they want for a tax return.

Focus on quality: I conducted a quality assurance check with my existing clients and found out that some of my clients wanted me to move to a better location.

So I found a new location where I rented just a room in a very nice office and this increased my client retention.

Since I already had a discount on my existing lease, the net rent amount stayed the same. Most of my clients were surprised that I was able to expand in this tough economy, giving them new admiration for my wealth-building expertise.

My advice to other small business owners who might be going through similar times is not to throw in the towel. Network with other like-minded entrepreneurs and hold on to your faith.

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Image: Geoffrey Meyer-van Voorthuijsen via Flickr, Creative Commons

Ebere Okoye is the CEO of Wealth Building CPA and has been a Certified Public Accountant for 15 years. She holds a B.S. in Accounting and MBA from the University of Maryland. Her unique areas of expertise give her an in-depth understanding of the mistakes individuals and businesses make in their tax planning and investments. You can reach Ebere via email at info [a] wealthbuildingcpa [dot] com, on Twitter, or via her website. Mention WomenGrowBusiness.com for a free initial consultation.

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