Turnover

[Oh Baby!]

I am wondering if people would be willing to share what they experience each year in the way of client turnover as a percentage of their clients.

[Gail in Virginia]

I think that is an interesting question, but since it is not a number I have been tracking, it is not something I have the time to work up in January. Others may have it readily available. If you ask again, or bump this thread, after April 15, I would try to answer.

[Yardley CPA]

My practice is relatively small because I prepare my returns (in the evenings and on weekends) outside of my normal day job. I have about 125 clients. Each year, I find one or two that tend to go elsewhere, either due to a relocation or "just because." I have maintained a consistent client base and I find I add a few each year, so the at the end of the season I tend to have more than what I started with.

[Crank]

My practice is relatively small because I prepare my returns (in the evenings and on weekends) outside of my normal day job. I have about 125 clients. Each year, I find one or two that tend to go elsewhere, either due to a relocation or "just because." I have maintained a consistent client base and I find I add a few each year, so the at the end of the season I tend to have more than what I started with.

My practice is very similar and holds around the 100 or so mark. All word of mouth. If they leave, they either die or move out of state. However, I have retained several that have moved out of state, which always surprises me.

[Catherine]

I hold on to folks who move usually for a couple of years. Then, once they've established connections in the new state, they tend to move on. Just had one elderly client move on permanently. So every year I lose a couple. They get more-than-made-up-for by folks who send their brothers, mothers, sisters, the kids grow up and become clients in their own right.

[taxxcpa]

I lose one or two per year and may pick up one or two new clients. In the past I've lost a lot of clients when I moved from Dallas to Midlothian, then to Cedar Hill, then back to Dallas.

I always failed to notify clients that I wanted to drop. I'm retiring from tax work after this tax season. Also, after I began working from home I get no drop-in business.

I've let my practice dwindle down to a point that it just isn't worth taking all the CPE, leaning all the new features of the tax software and being available.

I won't have the tax and accounting income, but I've paid off my mortgage which was costing me a lot more than I made doing tax and accounting work.

After I retire, I can come and go without worrying about having to wait for a client to show up or to be available for telephone calls.

I will not pay my PTIN fee and will only renew my CPA license at a reduced fee as a retired CPA. That way I can tell anyone that I cannot legally prepare their return (except for those I do free for my two daughters).

[Catherine]

This is the first year in several that I sent out NO letters warning a couple of carefully-chosen clients about big fee increases. Managed to get rid of all the PITA clients who don't pay me enough to be worth dealing with them. That's a happy achievement!

[MsTabbyKats]

I'm phasing out gradually.

Last year I stopped accepting new non-resident aliens.

I've dropped all the real PITAs.

I've lost some PITAs because I refuse to do anything that can come back to haunt me. There should be some more of those this year.

Certain things...which require too much time (returns with local PA, returns with complex international issues) are off my list.

I'm raising fees. If someone is unhappy.....I have no problem if they look elsewhere.

So...to answer the original question:

I lose about 10%.

I'm picky about new clients.

[Lion EA]

I hold on to folks who move usually for a couple of years. Then, once they've established connections in the new state, they tend to move on. Just had one elderly client move on permanently. So every year I lose a couple. They get more-than-made-up-for by folks who send their brothers, mothers, sisters, the kids grow up and become clients in their own right.

My experience is similar to Catherine's. I keep thinking I'll let my practice dwindle through attrition, but I have a small net gain every year. I also have shed some PITA clients through price increases. Those that drop off their tax information close to 15 October don't get prepared on time, some this month! So, I've sent some on their way over the years. But, referrals keep coming.

[MsTabbyKats]

Oh...my income was about $100 less in 2013 than in 2012....with about 25 fewer clients.

I think that's a good thing!

[RitaB]

I don't really track lost clients very carefully, but I lose a few (I'd guess 2%) and gain a few every year, so I feel like it's pretty much a wash. I do about 300 returns a year.

I was thinking this morning, I have lost probably 5 or 6 clients over the years (19 years) because they wanted to count as a business expense every mile they drove for any purpose times 10. Glad to be rid of them, and that appears to me be the most abused deduction of all time.

And, yes, I just got off on a rabbit trail. Sorry.

[Janitor Bob]

I have remained stable at approx. 140 clients for the past 6 years or so. Every year I lose a few...usually because they want RAL (which I do not offer) or because I ask too many questions (i.e. EITC and dependency issues). I also consistantly gain a few every year from referrals. I do not advertise but do offer existing clients a referral rebate for sending me clients. I have grown picky about what type of clinet I accept...I really do not want more because 140 is about as much as I can do along with another full-time accounting job.

[michaelmars]

Oh...my income was about $100 less in 2013 than in 2012....with about 25 fewer clients.

I think that's a good thing!

MINE WAS UP $1.50!!!!!!!

[kcjenkins]

Yep, when I was forced to cut back due to Don's health issues, it was really hard to get the number down. Only thing that really worked was when I finally moved out of state, after he died, and closed my business email account! Still doing just a few, but my own health issues made it easier for me to cut them. I still miss most of them, because so many were long-term clients, and I'd gotten the PITA's out already, and considered many of them personal friends as well as clients. Heck, a significant % were the children of clients, that I watched grow up.

[Janitor Bob]

I actually now have grandchildren of clients as clients!

[B. Jani]

Even though I am full time financial advisor and insurance agent in my primary job, I only have client from my business. I do not accept any one from street. Only existing client or referral. I am very choosy about who to accept. Have about 75-100 and will keep it that way.

[Hillenburg]

I filed 354 1040's for tax year 2012. I usually have about 3-4% that haven't filed by April 15th. But some reappear by October 15. And some appear the next Oct 15th. I have one client that usually waits until he can bring in 2 or 3 years at one time. I suppose I should give him a quantity discount.

[SaraEA]

We have more clients than we can handle. Fortunately, a large bunch of them habitually bring their stuff in the first or second week of April. We do quick calcs and tell them how much to send in with their extensions. That gives us 150-200 clients to work on during the summer. Every year a couple of pretty big accounts don't come back, for no reason we can discern. Some existing clients get bigger though, so the workload doesn't diminish. We also lose a few of the more standard clients (1040, Sch A, B, maybe D or E). And a few die. Still, we rarely accept new clients and then only by referral from an existing good client. A number of local attorneys refer trusts and estates to us, and we accept all of them because the attorneys are our clients too. Many of these returns have their own due dates, so it doesn't usually interfere with crunch time. We also get people who need representation, and it's hard to turn them down.

Are you really asking why people don't come back? Many clients we picked up over the years changed because of price or lack of responsiveness from their former preparer. If you don't answer their calls or emails promptly they'll go elsewhere. Some people just think they can do better (my friend always deducts his commuting miles/business suits/gym membership/cell phone). If you find that a lot of clients are leaving, it's time to take a hard look at your business practices. If not enough are leaving, it's time to take a hard look at your pricing.