Are you a low priority client?

In the world of public accounting and client-facing advisory roles, managing a diverse portfolio of clients is a common challenge. While every client is important, it's essential to acknowledge the existence of low priority clients and understand how to handle them effectively. In this blog, we will define what a low priority client is, discuss common characteristics associated with them, and provide guidance for clients who suspect they may fall into this category.

What is a low priority client?

A low priority client is a client whose needs and demands are not given the same level of attention, resources, or priority as other clients within a professional services firm. This designation is not necessarily a reflection of the client's worth or the quality of their business. Instead, it often results from factors such as the client's profitability, the complexity of their needs, or the firm's resource constraints.

What does a low priority client look like?

Before we jump into the characteristics of a low priority client relative to a high priority client, it is important to understand that the metrics are relative. One firm’s low priority client may be another firm’s high priority client, due to differences in firm structure and circumstances. Additionally, timing of certain client deadlines certainly plays a role in whether or not a client is deemed low priority in a given circumstance. Let’s jump into the common characteristics of low priority clients:

  1. Smaller Fees - Money talks, and it’s no secret that smaller fee clients get less attention than the more expensive clients. Accounting firms typically work on a leveraged model and scale well with larger engagements as they can better capture knowledge and efficiencies as the scope increases. As a result, these larger client engagements are not only more revenue than the smaller engagements, but they are also more profitable. 

  2. Relatively Simple in Complexity - Firms like to capture any complexities in their fee discussions, and having a small fee is typically an indication that the work isn’t too complex. This typically means that the work can be done by less experienced team members or can be done relatively quickly. 

  3. Smaller Volume - Like the complexity factor above, lower priority clients can have small fees because the volume of work is relatively small compared to larger fee clients. This means that the work can be done in a relatively short amount of time if needed.

  4. Deadlines - While tax deadlines are not very flexible, other deadlines tend to correlate with the size and complexity of the client. A publicly traded company has a more established and important deadline than the first time audit client. In practice, this means that the firm or the small client can delay deliverables without much consequences compared to the larger clients. Speaking from experience here, a lot of accounting firm operations are driven by the work that is most urgent, and not necessarily the work that is most efficient.

Why are they lower priority?

Firms typically deem a client lower priority as an extension of one or more of the above characteristics. A client could be a low priority to a firm because…

  1. It brings in less revenue and/or profit compared to other clients.

  2. The work can be done later or closer to the deadline because it’s relatively less complex or voluminous.

  3. The deadline isn’t as real, and there won’t be significant consequences for pushing the engagement out a few weeks.

As you can see, these reasons for the lower priority stem from the core characteristics listed above. 

What should you do if you are a low priority client?

If you are a low priority client, here’s what I recommend you do:

  1. Remember you aren’t the only client! - There are some of you reading this that may or may not be a low priority client but will see yourself as a “low priority” because your accountant has other obligations. If you want to control someone’s schedule and dictate their priorities, hire them in house! Even if you are a lower priority client to your accountant, having a level of empathy to their schedule and priorities can go a long way in your communication with them.

  2. Communicate your needs! - Because of the smaller scope of their projects, low priority clients tend to communicate less frequently than the larger clients. As a result, the lower priority clients are not top of mind and the larger clients, and it’s harder for a firm to plan for clients that have less frequent communication. If you think you are a low priority client, reach out to your accountant and try to schedule the work and agree on a realistic delivery date that works for everyone. Remember, being a low priority client isn’t necessarily a bad thing because with good communication, your needs can still be serviced appropriately.

  3. Upgrade your services! - The characteristics we discussed above mostly stem from the size and scope of an engagement. Typically, smaller scope and smaller volume add up to smaller fees which puts your engagement closer to the bottom of the priority list. If you can change some of these variables to make your engagement larger, in depth, and expensive (make sure you are still getting a good value), your spot on that priority list can shift upwards.

  4. Change service providers! - If all the above strategies don’t work, it may be a sign that you need to switch service providers. Remember, the lower priority status really depends on the accounting firm’s capacity and other clients. If you aren’t satisfied with the service you are getting, it’s probably because your arrangement isn’t a good match for your current provider. If you find yourself at this step, I recommend finding a provider that has multiple engagements that are similar in scope to yours.

Sometimes, being a low priority client isn’t an issue. There are many businesses that understand there are bigger fish to fry for accounting firms and it’s worth it to have an experienced firm handle the account despite any delays. Ultimately, the decision is up to you. Are you a low priority client? Is that okay with you? Let me know in the comments!