With economists predicting a 2023 recession, small business owners everywhere are hoping that their business is prepared for the downturn. Fortunately, by many standards, tax preparation is a “recession-proof business.” Even in uncertain times, there will always be a demand for professional tax help.
However, even tax offices aren’t completely immune to the effects of a recession. To ensure the long-term success of your tax office, it’s important to take proactive measures to recession-proof your business. You can strengthen your position in the industry and safeguard your tax office from economic downturn by adapting to changing customer preferences. This includes strategies like offering year-round services, leveraging technology, and more. In this guide, we’ll dive into these strategies to help you fortify your tax office against the uncertainties of the economy.
Diversify & offer year-round services
Instead of operating only during tax season, consider offering year-round services such as tax planning, payroll, and bookkeeping. With some additional education and certifications, you can add financial planning, retirement planning, estate planning, and small business consulting to your service offerings. This diversification can help you maintain a steady stream of clients and revenue throughout the year, mitigating the impact of a slower tax season.
Focus on customer retention
Building strong relationships with your existing clients is essential. Provide excellent customer service, personalized attention, and timely communication. Offer loyalty programs, referral incentives, and discounts to encourage repeat business and word-of-mouth referrals.
Check out 10 Tips to Increase Client Retention for more detailed strategies.
Adapt to remote work lifestyles
More and more clients prefer the ease of virtual tax preparation. Consider offering virtual consultations and using secure online portals like the TaxesToGo app for clients to share documents and communicate securely. This flexibility allows you to serve clients regardless of their location or work preferences.
Attract younger clients
Tailor your services and marketing efforts to appeal to younger generations. Leverage social media platforms and online advertising to engage with younger audiences. Highlight your expertise in areas like self-employment taxes, gig economy income, and student tax credits.
Cultivate a strong online presence
We mentioned social media above, but your online presence is so critical that it deserves repeating. Actively engaging on social media platforms can foster connections with potential clients. Aim to provide valuable tax-related content to position yourself as an industry expert.
You’ll also want to build a business website that showcases your services and makes it easy for clients to contact you. Make sure to use local SEO strategies to help clients in your area find your business faster.
Stay up to date on tax laws and regulations
It’s critical to continually educate yourself and your team on the latest tax laws, regulations, and industry trends. Being well-informed ensures accurate tax preparation services and builds trust with your clients. Our Guide to Continuing Education Credits can help you find trusted resources that keep you informed and help you maintain your credentials as an EA, CPA, or Annual Filing Season Program participant.
Monitor and manage expenses
If revenue is ever low, it’s crucial to keep a close eye on your business expenses. Identify areas where you can reduce costs without compromising the quality of your services. Review your budget and seek cost-saving opportunities such as opting for a virtual office or co-working space instead of a brick-and-mortar location.
Remember, no business is entirely immune to recessions, but by implementing these strategies, you can strengthen your tax preparation business and increase its resilience in the face of economic fluctuations.
