004 Client Wants Vs Needs

Gang today. Oh, we're talking about those clients that just make the ridiculous request where they're like, hey, can you give me. I'm gonna actually need this thing because of this or that arbitrary reason I'm going on vacation when they're like going to the beach 20 minutes away for a couple of days. How do you know if those things are real? How do you know if they're not real? What's the most tactful way to handle it? Love to hear if you got ideas in the comments too. And why am I doing this? What is. What is the upside of Jason Daly? To me, it feels very narcissistic to talk, to, talk about, but a number of people have asked. I think it's interesting. It's already through my framework for what's. Why this is worthwhile for me. Why it's the thing that I want to exist. And when I think about doing a new thing, like, what are kind of the tests that it has to pass, but also like, what are kind of my anti goals and things that I don't wanna wade into? So thanks for coming and hanging Jason Daly. Let's do it. So us tax people stuck in the throes of the sweatiest time of the year, and you get that email from a client that's like, hey, can you bend over backwards to do this sweat special thing that I want you to do? And the very worst part of it all is oftentimes it's not even a big deal. Like they don't actually need that. It's more just they want to be done with it. They want to have the return filed. I came of agent a firm that was just 100% wired this way. You filed all the tax returns by the deadline just from like an OCD standpoint, just so you had them done, just so that you could have them behind you. And obviously that was, that was more practical in the past than it is now. But even in the past, that was not a way to build a very compelling business model. So Fred Stein threw this out on Twitter. I think it's Stein. I think I'm saying that right. I'm sorry if it's not. He said, hey, can we talk about client wants vs client needs? Whenever we're asked by a client for something and they want it now, we try to ask whether it's a want or a need. And so the, the, like, the immediate example that comes to mind for me are the people who are like, I've never extended my tax return before. I'm not going to file after April 15, and they want you to get it done. And more and more tax pros now are saying, like, yeah, sorry, I'm just not going to help you with that. If you're not in the U.S. basically, in the U.S. you get an automatic extension of six months to file. The tax payment is still due, so you got to have some tax paid in, unless you want to pay some interest in penalties, but it's an automatic extension. There's a ton of great reasons to actually wait to file, like if some decisions you would take, you would make this year are impacted by how this current year's going, how profitable you are. So there's plenty of good reasons to do it. But historically, taxpayers just filed by April. And when you're the first one to tell them, like, no, we're actually gonna file in August, and it's gonna be fine. Not every. It's harder for some people than others to defer to that expertise. So that's the example that immediately comes to mind for me that has perpetually driven me nuts. Fred gave a couple other examples, largely arbitrary stuff. We're going on vacation. They want to buy 415 just because that's when they wanted to have their personal return done, as opposed to somebody who's refinancing. And that, like, may actually be an urgent need. Oh, those refinancing people just kill me. Rome's the range. Michael chucked in. He made it clear to his client base the decision to extend was his and not theirs. And if that was unacceptable, to let him know and he'd take him off his list. More and more people are doing that. I know, I know. Logan's been flexing on. On people that any new clients he takes on now automatically go on an extension. And that's just the terms of engagement. If you're going to work with me, it's. You're going to go on extension. That's just how it is. Which I think is a great example of how we can craft a different reality for new clients than our existing clients have. It's the changing that's hard. It's getting them from. What do you mean? I always. I always filed in March, and now you're gonna file me in June. That's what's hard is the change and the unique opportunity you have with new clients is to set a new expectation from day one that's beneficial for you. So that, like, if that's me, I'm thinking really hard about doing that with all my new clients. Amigrae, Fenner, she shared the people who are like, hey, I'm going on vacay and I would rather not have to think about it. She's got no problem trying to get that stuff done. She said she already did that for a couple people this year. John McCarthy said, We started charging a $400 rush fee to jump the line this year. One client happily paid it. One client is going on the fire list. One out of two ain't bad. So what do you do when that client like puts the screws to you and they really want that thing? Um, a few thoughts that I jotted down and this one's a hard thing to like come to anything concrete because there's so many. The, the need versus the want is probably a spectrum. It's not like a, it's not necessarily going to be a binary thing. But I can share a few things from my experience that I think would be helpful and is the kind of thing you can communicate to the team to say it's okay to push back on the client in this regard. First of all, and Fred said this, ask if I think back to, especially my earliest years in practice, if somebody asks for something, it's hard not just to jump up and dance and do whatever they really want you to do without digging any deeper. And there's a lot of people I've worked with that just have the mindset of like, who are you to ask the question? Like, we're, you know, we're order takers, like, we're here to serve them. If that's what they want, then that's what they want. But I think a degree of selfishness is healthy in your own, it's in your own best interest. And for the clients who got their info in sooner than that other person did, like, what makes you think that you should jump the line? So as simple as asking, like, hey, can I ask what the urgency is stemming from? We've got a bunch of people in the queue and out of respect to those people, like, we just have to be mindful of expediting anything. Second, I do think there are certain clients who are less inclined to defer to your expertise. So the, like, the, the ideal client, the clients that you really appreciate are the ones who are like, I trust you to get it done and not leave me hanging. And that's fine. And if you say that's gonna be fine for me, then like, you're the expert, which is how it should be. Right? The notion that we let our non tax pro clients come to us, pay us to Prepare their tax return and then tell us when to file it. Like there are very real strategic aspects of when's the right time to file. I've always thought there is virtually a. There is virtually never a benefit to filing earlier, but oftentimes a benefit to filing later. So why file earlier? There is like an element of it being a business decision for the accounting firm and it's. Is it fair for you to project on the client what is in your best interests? I would say yes, that's totally fair. It's kind of gotta be a balancing act. But then the third thought I had was I think this situation is more likely to happen when there's a void of expectations, when they don't know when they're gonna get it, when there isn't a plan. I think in my experience, the less of a plan there is, the more the client is inclined to draw within the lines to say, okay, can we do this or that for me? As opposed to if they have a clear target delivery date and they know up front what the expectation is not only of you to turn it around, but of them and when they need to get their stuff in to have it go out at a certain time. I think the more that you can shine a light on what that process is going to be, and this isn't just tax, this is, this is accounting in the month end close. This is virtually all the work that we do for people. The more that you can draw a picture of your design of what that process looks like for the client so that they know what to expect. In my experience, the less they're going to step on your toes and come in and kind of make their own requests. Because at that point it feels like there's a system there and there's a little more friction in them pushing you outside of what your traditional system is. So that's not going to be the case 100% of the time. But I have noticed the less that I communicate expectations with clients, the more they like to kind of set their own expectations. And that's just a healthy thing to be doing up front anyways, just to ensure that everybody's coming into an engagement thinking the same thing, right? Like when I started in the profession, all of our billing was after the fact and it was this big ta da moment when they would get the bill and you lose a bunch of money that way. When they're like, heck no, I'm not paying this bill. You're billing me 1200 bucks. I'm willing to pay 600 bucks here's 600 bucks. See you later. As opposed to if you gave them that price up front and there's scope changes that, you know, definitely make some of that hard. But 80% of the time when the scope's the same, like you can still give them a price up front and at least cut out some of those people who are going to be mad after the fact and not want to pay the bill. But not only with billings, but with expectations on turnaround time and all that stuff. The more that you can be proactive about that, the better. I've talked about this in the past. I. I think ultimately when you are doing something like tax in the US where it's very deadline dependent, you know whether that's real or perceived by clients, to me the only complete solution to that is is every client having an expected info in window and every client having an expected delivery window. And you set that, you're the one that dictates what that is. It doesn't mean there can't be some input from clients if they have a valid reason to get a return out by a certain day. Like in the old days it was, you know, fafsa. They needed a return to be able to apply for fafsa, stuff like that. But the kind of the three frameworks I see is the very basic framework that probably 80% of firms do, which is, yep, we'll do it when you bring it into us. And that's it. There's no planning. Maybe at the beginning of January, engagement letters and organizers go out and you just do the work when it comes in. And the big issue there is what happens when a client turns up on March 15, on March 20, on March 25, on April 1, there's that real kind of uncomfortable hokey pokey of why don't you tell me what you're expecting and then I'll tell you what's possible. And that creates some friction, especially in situations where maybe they can get you 90% of their information at the end of February and then they're waiting on those last couple of things until the end of March, like what does that mean? Do you start work on it and then wait for it? Do you not start work until everything's in? But like that model of just taking it and doing it when it comes in, very risky. And there's no way to build expectations for the client around that. So kind of the second methodology that I think most, well, more people have moved to now, what I see the most in kind of the discussions in the tax Twitter crowd is everybody's got a cutoff date. So you have to have everything in by X date for us to prepare it and then maybe everything in by X later date for us to prepare an extension estimate for you. And that's better than the first methodology. But where I get stuck on that is if it took you until October 15th to get all the tax returns done last year and you say March 1st, the deadline now, and everybody gets you their info by March 1st, it's going to take you until October 15th to get all those tax returns done. So like, I don't know that you actually have any more. You do, you have some more control over the process by setting that deadline. But in some ways you have more to lose if you say get this to me by this date and I will get it done. If 20% more people get you their information by that date and, and you've now committed yourself to doing it, man, that's not really a fun place to be either. So it was really, I think it was probably Jacob Oberlander that opened my eyes to this. First they run a tax and accounting. No, just tax, not even accounting. They do some VCFO stuff, but it's a largely a tax firm that works four hour weeks, doesn't work any overtime throughout the year. Super cool firm, super profitable. And every single one of their clients gets, I think it's maybe like a two week expected delivery window. And then working upstream from that, there's a time frame at which they're expected to have all their information in and they do their capacity planning throughout the year to make sure that there's some margin there because there's inevitably surprise situations where somebody needs to pull that delivery time up and you can give kind of some grace for that and some flexibility within reason. But obviously if they're doing that every single year, that becomes problematic. But then you've got a plan. You've gone from sitting back and waiting to see what comes in the door to everybody has a week and you build some buffer into every week you'll give some flexibility for people to move stuff around. Some clients are gonna be deadbeats and not give you stuff when you need it. And so maybe some of those slip, slide or maybe just cut them loose if they do slide. But like that's a plan and you can staff around that. And that's pretty cut and dried. But that means like putting a lid on probably new client intake unless you build some buffer to account for that. And I think the, the more you can proactively communicate that to a client to say, like, here's, here's what the expectation is. I think we feel some friction to say, like, oh, who are we to do that for our clients? Cause you haven't done that in the past. But oftentimes I think they actually prefer that, like it looks better. I don't know that they're as. Most clients are as concerned with what the plan is as long as there's a plan. And I think that works for most people. But fundamentally it works the best for you and ensures the highest likelihood of you being able to turn something around on like an expectation that's reasonable and that you mutually agreed to because you can put that in the engagement letter. Then you can say, hey, you got to have all your stuff in by this date and we're going to get it done by that date. And it is what it is. And if everybody makes a run on the bank and they get you all their stuff early, that doesn't change the expected delivery date. Doesn't. Doesn't mean you can't still work on that other stuff. But you've got a plan and you're able to kind of capacity plan around that stuff. To me, that's always been like the ultimate solution. It solves the extension expectation issue and it's a more intentional plan that I think gives clients less of a sense of there being wiggle room to make special requests and when there's a, a void of expectation and kind of that, that vacuum of not exactly knowing when it's going to happen or what the plan is or even if there is a queue or how many other clients you're working on. Like when there isn't a plan there, I think it becomes more likely that clients inject their own plan into whatever you're trying to do. What do you think about that? There's a good number of like fringe new firm owners, people considering being new firm owners. If you're one of the more experienced people in the bunch here, drop a little comment of like, what are your thoughts on managing wants versus needs? Where do you draw the line? Does that stuff only come up if there isn't an explicit plan? Drop that stuff in the comments. And that's like, that's a great way of sharing value with really all of us who can learn something from that, but especially the folks who are still early stages and trying to figure out how to set those client expectations. It's great discussion though. Fred, Fred is definitely not one of those people. Early stages, setting expectations. Right. Okay. A bunch of people have Asked why am I doing this? And it's like it feels super narcissistic to talk about, but I do think there's value in sharing my process and kind of my framework for why I would decide to do something like this. A Daily Show. Are you a maniac? I talked about this a bit a couple of days ago, how making the intentional decision to put content out on the Internet is the ultimate vehicle for serendipity in your life. It attracts the like minded people and opportunities and things that you cannot even fathom are possible. So I think the more you put yourself out there, the more likely you are to enable that stuff. And from me having done that for the past couple of years, I have made so many friends in this space and virtually everything I know has come from me sharing. And when I share, people reciprocate. And I'm able to pick up on the shared experiences of all these other people who are coming along for the ride and sharing not only with me, but with the other people hanging out in that space. And as I'm talking with folks on, on Twitter and LinkedIn and having these discussions, it just got to the point where like there were so many great discussions to have that I couldn't shoehorn into a Once a week YouTube video or something like that, right? Like this there's too much structure. It's not freeform enough. But then what Jessica shared on Twitter, I think I talked about this yesterday. The that whole level of I feel like I know you like I have that with so many people on Twitter. And honestly that was like such a godsend for me to find tax Twitter at a point when everything about firm running was feeling so isolating. You're surrounded by people who are all subject to the same group think, the same kind of framework of running a firm. And especially in a firm of any size, when you have so much inertia going in a given direction, it is so hard to change it. Not only the inertia of all of your internal team members, but the inertia of your entire client base. Because with clients it's the change that's hard, right? You bring somebody in with a new expectation, that's easy. But when you have to tell 500 clients, yeah, no, you're actually going to get extended now, even though you've never been extended before or the expectation is changing from this to that man, that is so hard. And without the broader perspective of hey what are you doing? Or being able to put out a tweet and 20 people share their own experience on, oh, buddy, we did that a couple of years ago. Abort. You don't want to do that. Or we did that five years ago, and it's the best thing we ever did. Oh, my gosh. That perspective is so refreshing and takes what is an extremely isolating thing that nobody else in your life understands because they don't run firms. It takes that really isolating thing and makes it something that, I don't know, feels a little more shared, like, at least there's people out there who are suffering the same way that I'm suffering. And some days that's enough, you know, but like, I've always said, like, more valuable to me than. Than consultants or Think Boys or. Or anything else is like, get me in a room with five other people that run a firm just like I do, and have a very intimate understandings of what is hard about my life. And that is like, I will learn so much from those people because we talk about what works, what doesn't work. Like, just like, there's nothing more energizing to me than finding those people. That's why I've always loved going to conferences and stuff like that, because I always come back invigorated. When you're able to get outside of that group, think of the people that you work with every day and the clients that you work with every day, and you realize that your little reality is crafted by those people in those conversations and the way you think about running a firm. But then you take one step outside of that to kind of interact with the broader community, and that is so energizing. And honestly, I would love for this to be that. Like, if I felt like I had a friend when I was ultra isolated and could and had the experience of engaging with a group of people who were, you know, sharing what they were learning along the way, and, you know, for some people, the stuff they figured out 10 years ago that maybe I hadn't even started thinking about yet, right? Like, everybody's on different parts of this journey, but to be exposed to kind of a broader community of people who are willing to share, we're able to approach this stuff with positivity, which some days is really, really hard, especially when there's kind of that existential dread from email overwhelm and disappointing clients and all that stuff, to see the people on the other side of it that understand the ups and downs of running a business like that, of managing staff, of being able to put boundaries around the mean things that your clients say, that it's really hard not to Take personally, you know, struggling with being selfish enough to make the decisions that are right for you, even if they're not the best thing for your client. Boy, having those people in your life that can even just be like, yep, that was the right thing to do, that pissed off some clients, or that was really hard that you had to let those clients go or let those staff go. But in your situation, you did the right thing. Like, that completely changes the long term outlook of man. Is this a thing that I can actually do for the next 20 years? Is it going to be sustainable for me? And if this can be that outlet, like, I joked yesterday about it being Mr. Rogers of accounting. Like, if. If it can give people energy and like, get them through the day, like, there is, man, there's nothing I would be more proud of than that. So that's the gist of why I'm doing it. It also scratches some itches of stuff that I would like to get better at. Like, this is a ton of fun for me. It builds more connections. It's a way for me to spend time with people I enjoy talking with. But it's also a super valuable skill for me to develop, right? Like getting better at this stuff and this quick turnaround production and all of that. So I try to think about where I was five or 10 years ago, and I would've loved this. I would've loved having a little. A little space to come to and talk with people that were like me, that were into the same stuff that would have made firm running for me feel so much more manageable than it did. So that's the gist of it. Thanks y' all for coming and hanging. Drop a little note in the comments and meet the people in the comments. There's a bunch of rad people who are coming and hanging, who you know. Like, the cool thing about doing this is it attracts a very similar type of people that I make friends with and that you would probably make great friends with too. So hop in the comments and you'll probably find some cool people down there with that. See you tomorrow.