referrals

[spanel]

I pay $10 per referrals to my clients for all new customers..... I have around 50 of them this year... that comes out to alot of $10 checks to write. Anyone have any better way of giving these "refunds" without writing so many checks, but still having a paper trail?

Thanks!

Chris

[BOB W]

If you are getting the referrals be happy to write the checks, even if it was a thousand checks. What better way can you spend your time to increase your business.

Of course you can always issue a $10 credit toward next year's fee.

[erchess]

Referrals

Instead of a cash payment I give ten percent off the referrer's next return. I give everyone all the business cards they desire. I have them write their names on the back and if someone brings in a card with your name on the back then I hang onto it. When I do your return I give you a discount of ten percent of your fee for each referral but the maximum total discount is 100%. IOW I won't be writing you a check. I like my system because it ensures the referrer will be a returning client.

[Lion]

Discount

I also give a referral discount next tax season to my current clients who refer new clients.

You could order a bunch of $10 American Express gift cards (or your local mall cards, or...) in one order that you think will be about a year's worth. Then you can hand them out or mail them out as needed.

[BOB W]

I have a problem giving a credit towards next year's fee. What if next year's tax return is a little more complicated and you need to raise your fee? Some clients will preceive this increase as a way to take away their credit. Your increase in next year's fee could be just a general increase, but it would be preceived as a recapture of the discount.

The only solution is to give the credit and lock in last year's fee also, as part of the referral discount. Of course the return would have to be for the same return issues as last year.

[spanel]

Thanks for all the ideas so far! My next thought it Wal-mart Gift cards. Would you be ok with that if you sent me a referal?

BTW.. population 10,000.. Walmart supercenter with grocery dept. No other major shopping center.


Chris

[ChEAr$]

I have a problem giving a credit towards next year's fee. What if next year's tax return is a little more complicated and you need to raise your fee? Some clients will preceive this increase as a way to take away their credit. Your increase in next year's fee could be just a general increase, but it would be preceived as a recapture of the discount.

The only solution is to give the credit and lock in last year's fee also, as part of the referral discount. Of course the return would have to be for the same return issues as last year.

All very good points, Bob, and all reinforce my long time policy of no referral fees and no discounts for anybody. I do stress to all clients that I'm a low cost producer and my fees are the lowest in town, that is for comparable quality and work.

[BOB W]

All very good points, Bob, and all reinforce my long time policy of no referral fees and no discounts for anybody. I do stress to all clients that I'm a low cost producer and my fees are the lowest in town, that is for comparable quality and work.

When I first started my practice I ran a drawing. The total payout was $1,000. Each client that referred a new client entered, for each referral, one entry. I set it up for 5 winners. $500, $250, $150, $75 and $25. The drawing was for 4/15.

I ran this for 2 years with great results. My new client fees greatly exceeded the $1,000 cost. ( I only had to write 5 checks.)

I stopped the drawing because I had enough clients for the time being. But each of the 1st and second place winners never returned after they won. It was a good trade off but not what I liked to see happen. My gut feeling was that they felt that I would get the money back from them next year. I was happy to give the money away without any strings attached.

By the way, those were the days when a Federal & State returns went for $25-$50. (hand written).

Soon after Computers came into the picture to absorb the redundant part of doing hand written tax returns. But I had enough of a client base for "growth by referral" to take hold without running any more drawings.

[RitaB]

I thought of that, too

My next thought it Wal-mart Gift cards. Would you be ok with that if you sent me a referal?Chris

I like that idea, Chris. And, I would certainly appreciate and use the card.

[BOB W]

I like that idea, Chris. And, I would certainly appreciate and use the card.

Detachment of your money from client's money is what a Gift Card can accomplish.

You could solicit resturants and other businesses for participation at a discount to you, like it costs you $5 for your clients $10 discount. Or $0 for a $10 gift card.

[JohnH]

We haven't discussed the other side of this situation.
I have a couple of clients I'll PAY somebody to take away from me.
How can I best accomplish that?

[Jiggers]

How much?

We haven't discussed the other side of this situation.
I have a couple of clients I'll PAY somebody to take away from me.
How can I best accomplish that?

It will take a lot more than a $10 Wal-Mart card!

[RitaB]

You guys!

We haven't discussed the other side of this situation.
I have a couple of clients I'll PAY somebody to take away from me.
How can I best accomplish that?

John, you have a knack for saying what I am thinking.

It will take a lot more than a $10 Wal-Mart card!

Amen, Jiggers!


I am happy to say that I sent a "sorry I won't be able to do your bookkeeping because of other obligations and circumstances" note to a prospect yesterday. He came in weeks ago, and I gave him a short list of things to get together for me. Would have taken any one of us minutes to round up. He was going to return in a couple of days. It might be an unfair evaluation, but I figured the odds are that he is a slacker, and I don't want to deal with him. I feel great about the decision.

So, John, he will probably be giving you a call... LOL.

[jimmcg]

We haven't discussed the other side of this situation.
I have a couple of clients I'll PAY somebody to take away from me.
How can I best accomplish that?

Just tell them the truth, life is too short to put up with obnoxious PIA's like them. However if you are one who wishes to be socially correct then tell them that the complexity of their tax situation has gone beyond your technical expertise and they would be better served by someone else who is more knowledgable and astute.

[Roberts]

Just tell them the truth, life is too short to put up with obnoxious PIA's like them. However if you are one who wishes to be socially correct then tell them that the complexity of their tax situation has gone beyond your technical expertise and they would be better served by someone else who is more knowledgable and astute.

That or raise the fee to a level you are comfortable putting up with them.

I've never understood why people complain about clients.