4 Performance Targets Your Accounting Firm Should Aim For

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4 Performance Targets Your Accounting Firm Should
Aim For
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• If youre an accounting professional, its
  imperative that you are able to offer your
  clients are a high level of service, and in order
  to do that, you need to be setting and tracking
  some important performance targets.
• Performance targets are goals that you set and
  aim to achieve within a certain period of time,
  such as a year, and which can be used to help
  accounting firms (and all other types of
  businesses) reach goals, improve upon their
  performance, and boost productivity.

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• Here are 4 performance targets for your
  accounting firm to aim for
• 1. Client profitability
• Your firms profits are entirely dependent on
  your clients, and so every month, quarter, or
  year (profitability tracking will vary according
  to each firm), you can get a picture of just how
  profitable certain clients are by totalling up
  the revenue generated by each one, and
  subtracting costs related to the job, such as
  supplies and software.

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• Accounting software can be used to do this, and
  once youve established the profitability of each
  client, you can work out how to increase it. This
  may be through reevaluated pricing, or the
  addition of offers or extra packages, for
  example, and once youve done this, you can set
  some goals that fit your profitability plan for
  the year.
• 2. Client base growth
• Targets and goals can also be used to track and
  improve upon the growth of your client base,
  helping you get a clearer picture of whether your
  company is experiencing growth or not.

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• It may be wise to track overall and new client
  growth, for the clearest picture. Then, you can
  look at your existing metrics for growth to see
  how many clients have been brought in during a
  specific time frame, and work out what your goal
  should be. Once a realistic target has been
  determined, you can make a list of what can be
  done to help you reach it, such as by asking for
  referrals, or adjusting your marketing
  strategies.
• 3. Client retention
• While attracting new clients is always desirable,
  retaining clients and providing them with a good
  service on a long-term basis is what every
  accounting firm needs to be truly successful.
  With this in mind, client retention becomes one
  of the most important performance targets to
  track.

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• Once youve figured out what your existing
  retention rate is, you can start by setting some
  goals for the short-term, such as a referral
  program, which will help you meet your primary
  goal of improving upon client retention.
• 4. Price per engagement
• By tracking your firms prices for every
  engagement, you can better determine whether you
  might be charging too much, or too little for
  your services. As your firm gets bigger, working
  out the average price of every client engagement
  should help you tweak your costs to ensure that
  as you grow, your price per engagement grows too,
  and that you and your associates are being paid
  the true worth of your services.

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• There are numerous performance targets that your
  accounting firm can set for itself, to stay on
  track and support your long-term growth. Some may
  be big and take a lot longer to achieve, while
  others may be smaller and achieved on a much
  quicker scale. Conduct some research, study your
  existing metrics, get a sound idea of what needs
  to be improved, and start setting those
  performance targets today, for a healthier,
  wealthier tomorrow!

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