Five Ways to Rev Up Your Referrals

In the vast majority of industries, referrals are the most cost-effective way to gain new clients and grow your business.  When you attract new clients through referrals, your marketing costs are lower, your selling process is easier and more effective, and the referral usually makes for an excellent client.  It’s just good business sense to look at how we can proactively increase our referrals.   Here are five ideas.

1.      Your Email Signature

We know it can be embarrassing or uncomfortable to ask your clients and friends directly for referrals.  A great compromise is to add a line to your email signature that takes care of it for you.  Here are a couple of wording options:

Your referral is our greatest compliment!

Referrals are the lifeblood of our business. We thank you for yours.

We appreciate your referrals.

Adding one of these lines to your email signature file is a subtle notice to everyone you email that you are open to taking referrals.  It’s indirect enough to where no one feels put on the spot, and it takes all of five minutes to implement. 

2.  Acknowledge Your Referral Sources

When you find out someone has sent you a referral, be sure to acknowledge that person with a thank you note or a gift.  (Be sure to check any licenses you hold so you know what restrictions you are under concerning gifts to clients; some industries disallow it.)

You might want to reward your top referral sources with more than a thank you note.  If you are not sure who your top referral sources are, we can help you create a report in your accounting system so you can track that information on a regular basis. 

3.  Set Up a Referral Program

Creating a formal referral program generates several benefits:

·         It formalizes the process of asking for referrals.  This lets clients know you’re serious and interested in referrals. 

·         It gets the word out to everyone without anyone feeling pressured. 

·         It is cost-effective and still far lower cost than using other marketing channels. 

·         It is not too time-consuming and produces results.

To set up your referral program, decide how you want to reward your referral sources.  It could be as fun as awarding prizes such as Kindles and tablets to clients who send the most referrals to you.  The cost of the prize is a small price to pay for the lifetime revenue of several new high-quality clients.  Send a letter or email out announcing the program, and then set up a process for tracking. 

If you’re in an industry where prizes and programs are simply not done, then a simple letter requesting referrals will work too.  Be sure to include a description of the specific type of client you are looking for; you are far more likely to get referrals when clients know who to look for. 

4.  Develop Referral Sources

One way to truly quantum-leap your business is to find new sources of referrals.  Your clients are a great source, but they each know so many people.  If your clients have been with you for a while, your referrals could stagnate because your clients have referred just about everybody they are going to. 

Keep your referrals growing by tapping into power partners.  These are small business owners that have the same type of client you do, but are not competitive at all.  The best way to reach out to them is to send them a referral!

5.  Set Up Referral Processes

There’s a lot your back office can automatically do when it comes to referral processes. 

·         You can remember to ask how a new lead heard about you when they first call.  Then you can record and track that, so that you will know where your top referral sources are.  You can systematize the thank you notes and gifts so they go out timely and automatically. You can regularly schedule times with power partner to keep them up to date on your business changes and opportunities. You can systematize a referral program or related communications to keep everyone informed. Once you set up these processes and delegate the tasks, you will grow your referrals and subsequently your revenues. 

Oh, and by the way, we appreciate your referrals!

What Does Popeye Have to Do with Accounting?

You might have heard the terms “cash basis accounting” or “accrual accounting.”  Your net income number can change depending on which method your books are set up for.  Here’s a simple explanation of the difference, with a little help from one of the most famous cartoon characters in history.

Popeye and Wimpy

You might recognize Popeye the Sailor Man from the television cartoons or other media.  His sidekick, Wimpy, was the one who was always hungry and always out of cash.  One of his favorite sayings was, “I’ll gladly pay you Tuesday for a hamburger today.” 

It’s All in the Timing

Let’s make today Thursday.  If Wimpy wants to pay us Tuesday for a hamburger today, here’s how it would be done for a restaurant on cash basis: Cash basis recording Wimpy’s hamburger purchase Both the sale and the receipt of cash would be recorded on Tuesday.  Companies on cash basis only record the transaction when the cash is received. But, if the restaurant’s books were on the accrual basis, it would be a different story: Accrual basis recording Wimpy’s hamburger purchase Wimpy’s hamburger sale would be recorded on Thursday, the day he ate the hamburger.  The receipt would then be recorded on Tuesday, assuming Wimpy made good on his promise to pay. You might be asking why a few days is such a big deal.  Outside of cartoon life, a couple of extra twists can happen.  It can be far more than a few days from the time you do the work to the time you get paid for it.  And often, these dates span different months and even years, affecting the amount you have to pay in taxes to various agencies.  Manipulating these dates (legally, of course) is one of many tax planning strategies that we can help you with.      

Choosing for Your Business

In many cases, the government has chosen which method you must use when it comes to sales tax, payroll taxes, and income tax.  That’s part of the reason we make the required adjustments to your books at year end. To help you run your business in a forward-thinking way, the accrual method is best.  You can record invoices for work you’ve done even though you haven’t received payment yet.  You can enter bills you need to pay before you pay them to forecast cash requirements.  Using accrual accounting, you can budget for cash flow needs as well as see more accurately what your revenue and income is looking like. For clients who remain behind in their bookkeeping and just want to catch everything up once a year, the cash basis is adequate.  However they lose out on all the good information they could have had throughout the year to run their business better. For other businesses, a hybrid approach between cash and accrual accounting can be the most cost effective. 

A Little Help from Popeye the Sailor

What would Popeye say about all this accounting talk? 

"That's all I can stands, cuz I can't stands n'more!" 

Accounting has finally come around to your smartphone

If you are the type of person who loves mobile apps, texting, and getting your email on your phone, then you’re in for a treat: accounting has finally come around to your smartphone.  Here are a couple of great developments you can try so you can stay on top of your numbers. 

Accounting Apps

For users of QuickBooks desktop and QuickBooks Online, an app is available to help you stay on top of your accounts receivables.  You can send invoices, view and update customer information, mark an invoice paid, and check up on customers’ balances. 

These apps work on the iPhone, iPad, and Android.  With QuickBooks, there is a small monthly charge after a free trial.   

Bank Apps

If you’re banking with a major bank, chances are “there’s an app for that.”  Downloading your banking mobile app will allow you to stay on top of balances, receive alerts, and manage your cash flow more effectively. 

Payment Apps

More and more businesses are collecting customer payments via their smartphones.  You don’t even need a merchant account for some of these payment apps, like Square, PayPal, or Intuit Mobile GoPayment, but it is cheaper if you do.  If you’re not already taking credit cards, it’s an effective way to get started; your customers can pay via Visa, American Express, MasterCard, and Discover. 

With many of these payment apps, you download the app, receive a reader in the mail, and are then able to swipe or key in a client’s credit card information.  You are charged by the transaction, or monthly, if you sign up for a merchant account.  Plus, you can often customize the receipts the client receives with your logo to make them look professional.   

Add-on Apps 

There are many other mobile apps that can increase your accounting capabilities.  Both ADP and Paychex have payroll apps for their clients.  There are numerous apps to extend many of your accounting functions, such as expense management, document management, invoicing, time-tracking, bill payment, and even work order management. 

Accounting to Go

Now you have a choice with your accounting:  you can “eat here” or take it “to go.”  If we can help get you equipped as an accounting road warrior, give us a shout.