Running a business costs money. But there are ways to save, and there are ways to spend efficiently. Here are five things you can do to make your tax prep business more cost-effective over time.
1. Focus on client retention
Did you know that acquiring a new client can cost five times more than retaining an existing one? This doesn’t mean you shouldn’t market to new clients (of course, you should). But you must also focus your efforts on nurturing your existing clients who are spending their money on your services each tax season.
Show your returning clients that you value their business. Ask for honest feedback and be responsive when they give it. What are you doing right, and what could you do better?
Provide a customer experience that can’t be outdone by your competitors. Maintain contact year-round and clearly communicate any changes or updates that you make to your business offerings. Remember that satisfied clients are more likely to recommend you to their friends or family, too.
Want to learn more? Read 10 Tips to Increase Client Retention
2. Sign up for business accounts
A growing number of retailers offer business-focused accounts to customers. This type of account typically allows you to purchase items at exclusive, business-only pricing.
Some retailers, like Amazon, also provide analytics and reports about your purchases. Insights like these can help you identify areas where you are spending more than you may have realized – on ink cartridges and printer paper, for example.
Tired of spending so much on printer paper and ink? Discover how to go paperless with TaxSlayer Pro Premium.
3. Barter for goods and services
As a tax preparer, you possess a valuable skill set. Consider offering your services in exchange for something you need.
Depending on your circumstances, you might swap tax prep for IT services or for help creating a website. Perhaps your landlord would be willing to reduce your monthly rent if you file their return and ensure they are maintaining compliance.
Before you barter, keep these things in mind:
- Understand the value of the agreement. This will most likely be based on the amount of time you’ll spend and the skill it requires to do the job.
- Be certain you will collect. Protecting your own interest in a barter agreement is important. Put your terms in writing and stick to your own end of the bargain.
- Account for the exchange on your tax return. Yes, a barter transaction must be reported to the IRS. You will need to complete Form 1099-B.
As a bonus, your new client might recommend you to their friends and acquaintances.
4. Outsource simple tasks
As a tax preparer and a business owner, you have a lot to manage. Time is likely one of the most valuable assets you have. Hiring a full-time employee to help isn’t always cost-effective, but outsourcing can be.
There are probably tasks you don’t have the interest or expertise to accomplish, so spending time on them actually costs you money. Find a contractor to do those things that aren’t related to tax prep – like running your email marketing or maintaining your website. There are many online resources where you can outsource various tasks on a limited basis and at a rate that you set.
Alternatively, you might frame the job up as an internship opportunity and reach out to local colleges. New tax preparers may be looking for the chance to gain experience; an unpaid internship in your office could benefit them as much as it benefits you.
5. Take advantage of industry discounts
When it comes to saving money, every bit counts. Be a deal-seeker for all things: subscription plans, office supplies, industry events – even your tax prep software. And don’t expect an offer to be extended. Act as early as you can to secure your lowest rate possible.
TaxSlayer Pro sends information about special pricing – like the annual early bird renewal offer – via email and the TaxSlayer Pro website. You can also speak directly with a TaxSlayer Pro team member anytime at 1-888-420-1040.
This article was last updated on 11/10/2022.