Our firm was just referred another client this week.  This is happening a lot this year.  I believe people are in the mood for change (and you can even get a T-shirt to prove it).

We wanted to work with this client, and he really wanted us to start doing his work.  But he had already spent money with another CPA this year, and was not going to get any value out of it.  In fact, he was going to pay more this year because he paid the last CPA for something that the CPA didn’t do, and now was going to pay us for preparing the same tax return the other CPA was charging him for.

So we decided to reduce our bill this year by the amount he had already paid the last CPA.  In essence, we are taking our competitor’s coupons.  You can look at this one of two ways:

1.  We lost money on this new client this year.  We could have been paid X amount, but instead agreed to be paid a lower X amount.  What a bad deal!


2.  We gained a new client that will be a client for life, and will pay us for our services for many years to come, and will probably use our firm to perform additional services he didn’t know he could get from his CPA firm.

You have to be careful who you take as new clients if you are going to be discounting their first year’s bill.  I wouldn’t suggest this as a policy, but I would say be ready to absorb some initial costs if it means you will get a good paying client (who will probably refer other good paying clients in the future). 

This approach may work better in a service firm with client relationships than in a retail to customer setting, but the theory is still the same: view your clients/customers from a long-term perspective (as opposed to immediate) in terms of their value to your company

Thanks, Jason M. Blumer