This month I had the pleasure of interviewing NCI client Adil Baloch. He started his business with the NCI marketing program right at the start of 2007, looking down the barrel of a steady economic decline. Despite those setbacks he has grown a successful business employing several people and reached a point in 2009 where he could no longer handle all the work that was pouring in from the NCI marketing program. Adil has a lot of great advice to offer for both those considering the NCI marketing program and also those currently running it. Enjoy!
Chris: Adil, please tell me about your business background. What led you to starting your own accounting firm?
Adil: Up until 2006 I had been doing everything from a senior revenue manager to a controller to a director of finance. Right before I started my practice I was doing independent contracting and I had a pretty lucrative contract with Freddie Mac. My contract was almost over and I was getting ready to go over to Fannie Mae. At this point I looked at the financial picture and realized I was only making half of the job’s compensation because there was a middleman taking a good chunk of it. So I thought, why don’t I have something of my own where I can work with people directly instead of worrying about going through middlemen. I felt that I could provide a much better service at a better price. At that point I decided I was going to start my own practice.
Then I was looking to come up with a plan. Where do I go? What do I do? So I did some Google searches and stumbled upon NCI. I searched terms like “practice management” and “how does a CPA start his business?” I called NCI and was given an overview of the marketing programs. I wanted to start and grow a business but I didn’t know where to start. I was looking for someone who could walk me through and guide me on how to set up my business and grow it. In researching NCI I looked over your money-back guarantee and your guarantee to increase billings. It was too hard to resist. I attended the Plan I Practice Development Seminar in December of 2006. I liked the program very much but my problem was my professional skepticism, which comes with the territory as an accountant. I wasn’t sure about upgrading to the Plan 2 CAP program because I wanted to prove to myself that it works first.
I got home from the seminar and I hired my first appointment setter in early January 2007. By January 10th we had signed up our first client, who to this day is my client. We started out charging him $225 a month and now he’s up to $2,200 a month in fees. He has grown and we have grown, so it worked out pretty well. In that first year by around July, I knew that the $150,000 billing guarantee in a year included with the Plan 2 program was very achievable. We were already billing around $150,000 after seven months! At that point I had all the work I could handle, plus my skepticism in the program had been resolved, and I had the money to invest. I saw no point in waiting so in October of 2007 I upgraded to Plan 2 and with NCI’s help we hired our first Client Service Representative. He did not work out. The second CSR also did not end up working out, although he did bring in a lot of business. The third one worked out quite well.
I think it’s good for our readers to hear about something like that. We don’t always hire the right CSR out of the gate. No one could make that claim without lying. It’s not an exact science. The key is persistence.
Now here’s the part I don’t know if you want to mention or not. Things have worked out well for me, and I wouldn’t have it any other way and I love things the way they are. About two years ago I realized that there was a reason I wanted to go into business for myself. I wanted more time for myself, and I wanted to be able to spend more time with my kids and just have time for all the things I’ve wanted to do. So about two and a half years ago the business just kept coming in and I was getting busier and busier. I was already up to five employees by then. Things were going great but I didn’t have enough time for myself. I was comfortable where we were with the business and I didn’t want to keep growing to the point I couldn’t sustain it. We have clients that have come to us with horror stories from their experience with a previous CPA firm who didn’t have time for them. That is an opportunity to us. So I decided to take a break from the marketing and stop bringing in new monthly clients.
That’s fine, Adil. What you just described really covers the majority of our Plan 2 clients. Everybody has that point that they reach where they say “okay, I’m comfortable here. Growth is no longer a top priority.” At that point it doesn’t really make sense to continue to market.
Yeah. So I said I’m at about $350,000 in gross billings I bring home a nice income from that amount. That has allowed me to do the things I always wanted to do. I took cruises with my family, I took vacations with my kids, and I bought the car that I always wanted.So I’ve been doing all of that over the past two and a half years. Now this year, I said let’s pump it up once again. If I get to a point where it’s too much, then I can do what I did before and shut it down.
That’s another great thing about the program. You have it available to you when you need or want to grow.
Absolutely, so what I did to prepare was hire another CPA. All the new business that comes in is going to go to that CPA, plus I’m transitioning some of the existing business that I have over to him. I still interact with all my clients, they know me, but if they have general questions they know they can just call the office to get those answered. If they aren’t satisfied with that answer they can always call me.
So that is where I am.
I would like to grow the practice a bit more, keep it at that level for about ten more years and then sell it. There was a very nice office close to my previous location in a much better area. Our old building was a C-category building, were in an A-category building now. I had been in the old building for five years so I wanted to stay close to that location but upgrade the building and be in a much nicer place so that it will be more presentable to larger clients. So I bought this new office, I just closed on it.
Thank you. So I own the building now instead of renting, it’s a much larger office than before, with a nice conference room. I also started taking my own advice: I tell my clients to develop passive revenue streams on the side. I got together with a couple of friends and we started a construction company. That takes some of my time which is also partly why I hired my new CPA. That way I can check in with him and he can run my office, instead of me directly managing all of my employees.
You don’t want to spread yourself too thin. It sounds like you’re handling the growth of your practice very well. To recap, you said the program had generated about $350,000 in gross revenues from start-up and it took about two and a half years to get there?
Last year we grossed about $350,000+. Let me say it this way to put things in perspective, I made almost double last year what I was making at Freddie Mac as a consultant.
Wow, that’s excellent.
I drive a GL450 Mercedes Benz, which I always dreamed of and which I never would have thought possible before starting my practice with NCI.
That’s great. It’s a very special feeling to achieve a life-long goal like that.
Exactly, there are things we would all like to have where we say “one day I’m going to buy that” and it ends up on the backburner. Then all of a sudden you are able to make it a reality. There is nothing like that feeling. It is an excellent feeling.
Did you have any concerns before upgrading to Plan 2?
The only concern I had in my mind was, at the end of the day it would be a salesperson I’m sending out into the field to make the sale. The product he is selling is basically my name, my reputation. That was my only concern. I wanted to be very comfortable with the salesperson that went out and represented me.
That’s understandable. This person is going to be the face of your business, essentially.
That was really my only concern. I knew that the package of service you recommend was unique. No other CPAs offer a monthly package of services where you get practically everything for one price. All of the items might not be applicable to a client today but when it is applicable to them tomorrow there is no additional cost. No other CPA firms do that. The way that I was able to sell the package of service under Plan 1, I knew that anyone could sell it as long as the person knows what they are selling and they have faith in that product. One of my previous CSRs, Sidney, religiously brought in four new clients a week. Every Friday he would bring in four signed agreements and four checks. That went on for quite some time. I’m at a point now where if I wanted to, I could just work January through April and take the rest of the year off. That would mean shutting down the office, letting everyone go and just working from home, which I don’t want to do.
Sure, your employees depend on you, plus you’re helping to stimulate the economy, creating jobs. These are all good things, especially right now. Can you tell me a little bit about the initial misfires we had with the first two CSRs?
The first one was a very nice, sweet lady. She demonstrated all of the qualities you would like to see in a salesperson during her interviews. The problem was that she could not close. Every sales call she went on came back as a TIO (think it over.) She would take “no” for an answer without an issue. So that didn’t work out. NCI then helped me hire my second CSR, Sidney. He started out and brought in all kinds of business. Then what happened was, Sidney’s significant other teaches piano or something like that and I had an acoustic music retail shop as a client. Sidney apparently was trying to setup some kind of side business with this client. He called me up and was very uncomfortable with the situation. After that some other things came to the surface and I had to let Sidney go. The third CSR that was hired was Jerry Israel. Jerry also brought in steady business but not to the level of Sidney. It got to a point with Jerry where I was ready to shut the program down and Jerry was ready to move on as well. Jerry is an excellent person, I think he is 82 years old now and he still works, for an insurance company now. He still calls me every once in a while. So the timing of it worked out for both of us.
What has been your biggest challenge in running the program?
Keeping the appointment setters motivated can be a challenge. I’ve gone through quite a few appointment setters. They get burned out very quickly. My appointment setter, Alisha, has been working with us for a while now and we are at a point where if she schedules me an appointment, I know that I have a 90% chance to go out and close that client.
She’s at a point where she now understands everything so well that she practically makes the sale before I even get out and meet the client. To keep her motivated I moved her to full-time. Sometimes she helps out with payroll and during tax season she helps with bookkeeping. She has started going to school and taking some accounting classes as well. So her motivations are quite different now. She spends four hours a day on the phone and the rest of the day she helps out in other ways which she likes because she is learning. She’s salaried now so she doesn’t have to worry about what hours she works.She’s been with me over two years now.
You’ve found a way to overcome that challenge. It can be tough to find someone who really “gets” that job so when you do find someone like that you need to find ways to keep that person motivated and happy because it is a very difficult task.
Absolutely. I feel that in a year’s time she will be ready to transition out of the appointment setter role completely. I will feel very comfortable bringing someone else in who she can train and supervise.
What advice would you give to someone who is considering engaging in one of NCI’s marketing programs?
I think that I should have started the NCI marketing program five or six years earlier than I did. Anybody that wants to do this needs to get up and do it, because once you go into the field and you start presenting your services to business owners you will find that there are many people who desperately need the help of a good CPA. Getting business for a CPA using the NCI program, believe it or not, is a no-brainer. It’s not a big deal to go out or send someone out and sign up business consistently. The big challenge is keeping up with the work. If your concern is not being able to find enough business then you need to speak with NCI. There is business out there, I don’t care what is said about the economy, there is a lot of business out there.
I think that it’s good to hear something like that for our readers. A lot of people are afraid right now; they don’t want to make any changes to their current approach due to the uncertainty in the financial market.
Right in the middle of the situation, when everyone was saying the economy is in shambles, the sky is falling two and half years ago I had to stop marketing because I was getting so much business! I got more than I could handle.
Can you offer some advice to someone currently running the NCI marketing program drawing from your experience?
I think looking back at the way I’ve run and managed everything so far, I would say it is as important to take care of your existing clients as it is to bring in new clients. One thing I have seen is that there is a tremendous opportunity to get more business from your existing clients. The reason is there are so many things out there that people want to do but they don’t know how. A very simple example is a small company with five to six employees without a retirement plan or medical insurance benefits. Small business owners may not realize the benefits they receive by giving the previously mentioned types of benefits to their employees. When you put that out there and set that up for a client they will want to keep working with you on other projects. There is a tremendous opportunity to get more work from your existing clients. You must take good care of all your clients, there is a lot of hand-holding in the beginning but once that phase has ended don’t forget about those clients. That is something I struggle with; I try to stay in touch with all of my clients as much as possible. It’s obviously not possible to stay in touch with all of them constantly but at least let them know that you are accessible to them. Also keep an eye on who is sending you more business and who have been your long-term loyal clients.
I can see it being a real challenge to manage a large client base and to try and make sure that everyone is happy. That’s why you reach a certain point and you have to delegate to competent employees, which is what you are doing now with your new CPA.
That’s another thing for anyone currently running the marketing program. I got to a point where I became my own bottleneck in the business. Things would sit on my desk for up to two weeks before getting sent out because I did not have the time to get to it and everything had to go through me. Now when there is an IRS audit, I have everything ready and I don’t even look at it because I trust my employees to do good work. It has made my life so much easier. Having a good profit margin is nice but it’s not everything.
Plus at the end of the day you are only one man and there is only so much that one person can accomplish.
Every single small business person in this country, and I’ve worked with a lot of them now, are burning themselves out. They all have the same problem, working 12-15 hour days, crazy hours. Then they sit down to do their taxes and “I owe $25,000. Where did all the money go? What happens now?” You forgot to live along the way. Remember that.
You have to remember to enjoy the fruits of your labor; otherwise, what’s the point? Like you said earlier, taking vacations with your family, buying nice things, as a business owner you should have the flexibility and infrastructure to do those kinds of things.
You have to decide, do you want to be the handyman or the technician in your business or do you want to be the owner of your business? You cannot be both at the same time. The thing is, in the beginning business owners are very hesitant to hand over work to employees for fear of mistakes being made and their reputation being damaged. The key is finding the right people and spending time with them early on to train them properly. Yes, you will probably spend more time on that than by doing the work yourself but that is only temporary. Once your employees learn the job and really get going you will see a lot more getting accomplished than you could ever do on your own. It takes time to transition from being an accountant to being a business owner. Once you learn that and once you fill that role yourself then it becomes so easy for you to actually sell that point to your clients. You are able to be a much better business coach for your clients.
That makes sense, you have practical experience in running your business and you can apply that to your clients. Were you surprised by the growth you have been able to achieve during a terrible recession?
When I bought my car, I think it was last year on December 20th when congress passed the law on special depreciation of luxury cars. On December 21st I pulled my new Mercedes into my garage, I got out and looked at the car and I said to myself, “who knew?”
Chris Clark is the oldest son of New Clients Inc. founder and CEO Bruce Clark. He has worked as a Senior Account Executive at NCI for the past four years. During that time he has presented at the Practice Development Seminar on Internet and E-mail marketing and he also plays the prospective client during the seminar role play sessions. Chris also edits and contributes to the NCI newsletter, New Client News.