Today, we’re going whale hunting.
Or, at least the research required to go whale hunting.
First off, what’s a whale?
One of the nice things about 941 work over 1040 work is that the cases are much more diverse and interesting. Over 90% of 1040 tax resolution cases are just the same thing over and over and over. Most of them are Streamline or, as they are now called, “Expanded” Installment Agreements. Same thing, over and over…
Not so with 941 cases. 941 case work is much more varied, making it inherently more interesting, at least to a nerd like me.
One little factor that makes it more interesting? You’re much more likely to land the occasional mid-sized business as a client.
Depending upon whom you ask, a mid-sized business is defined as one with more than 100 employees, but less than 1,000 employees, or that has revenue in excess of $10 million per year but less than a $1 billion. The US SBA definition is much more complex, based on industry.
Medium-sized businesses are excellent clients for a number of reasons that are really beyond the scope of the challenge. From a strictly tax resolution perspective, they’re great because they can afford to pay you higher fees, and also because the root cause of their payroll tax problem is usually a short-term problem. Lastly, they can cash flow their way out of the federal and state tax debt. Oh, and for-reals lastly, they generally don’t have unfiled returns or mountains of accounting work to be done.
In other words, they’re pure representation clients. For somebody like me that doesn’t like doing tax prep, and isn’t an accountant, I love cases where all I’m doing is the representation!
Identifying potential whale clients is fairly simple, but marketing to them can be a different story. Today, we’ll talk about identifying them, and over the next few days we’ll talk about marketing to them.
Finding whales starts with having the right boat. For our purposes, the main boat you need is Google.
- Start by Googling phrases such as “your-city business in trouble” and “your-city company financial issues” and “your-city business faces losses”, etc.
- Find your local business journal, and start scouring for news articles and reports of businesses in trouble.
- Look online for your local “Book of Lists”, usually put out by a business journal publisher. Scour that list for year-over-year declines in staffing.
- If you have access to a prior year and current Chamber of Commerce directory, compare the two. Knowing who the larger companies are in your area, look for those businesses that dropped their Chamber membership.
- Since many mid-sized companies in local areas are in the construction and real estate industries, look for commercial construction projects and real estate developments that are behind schedule, over budget, or otherwise receiving negative press coverage locally.
- If you completed some of the earlier challenges this month, you’re now more connected to your local business community than you used to be. Let’s leverage that! Select two or three recent business connections who are themselves well connected or have the pulse on the business community, and send them a quick email asking if anything is coming through the grapevine about possible layoffs or other negative financial indicators at local companies.
- If you belong to a local niche industry association (which you should), such as your local Home Builders Association or Board of Realtors (as an associate member), ask around for the same thing.
Get the idea? You’re looking for local, larger businesses that might be facing some financial difficulties.
This challenge task is a bit more difficult for me to give you exact instructions on, since your local resources, news sources, connections, etc. can vary so widely from location to location and reader to reader. But hopefully I’ve given you enough here to start your sleuthing, and you’ll be able to find at least one or two companies that have been mentioned in the local media or through the grapevine.
Tomorrow, we’ll discuss what to do with this information.
While we’re talking about marketing to businesses, it’s worth mentioning that most of this marketing also applies to growing the 1120S/1065 side of your tax prep practice, also. In the members portal, I have a 2-hour training plus a complete marketing plan that can help you accomplish this. If you’re not yet a Tax Marketing HQ member, then what are you waiting for? Click here to get on it!