Let’s do this.
Main Street CPAs are on the front lines of the battle for small business survival. They can be first responders to the small businesses caught up in the crisis brought on by this crazy virus. They can make a positive difference to a business on the verge of closing or one that has had to close. They can do good and do well.
We have all seen the statistics and have heard how the virus has ravaged the national economy. Main Street businesses have been hit particularly hard. Yelp recently reported that 60 percent of the businesses on their site that have closed since March 1 are not reopening.
Small businesses and their owners are the lifeblood of the compliance, tax, bookkeeping, and outsourcing services provided by CPA firms. A shrinking pool of small businesses is not good for the local economy and certainly not good for the CPAs who count them as clients.
Main Street CPAs are in a privileged position to deliver impactful advice to help their clients do more than survive – they can help them thrive. Within the present turmoil and uncertainty lie the seeds of opportunity and latent growth.
CPAs know that a business’s value is far more than just the physical and tangible property, equipment, and inventory that are shown on a balance sheet. Numerous other types of assets are reflected in a company’s value and do not appear on the balance sheet. Alphabet Inc., Google’s parent company, had a tangible book value of $179 billion at the end of 2019. They had a corresponding market value of $935 billion.
Leveraging that knowledge and recognizing that a business’s valuable assets include customer lists, networks, and community relationships, CPAs can be a catalyst for helping lessen the damage caused by the pandemic.
A business that is closing due to the virus may not be able to be saved. But what if a CPA can make the closure less painful, at least financially?
Imagine this. A CPA has a client called “New Day Spa.” How can the CPA help New Day Spa and simultaneously help the local former owners of the closed “Old Spa” as well as their customers?
By helping New Day Spa acquire Old Spa customers for $0 down!
- With the New Day Spa owners, reach out to Old Spa owners.
- Let the Old Spa owners know that New Day Spa would like to help them recover some of their losses.
- The plan is to give them a percentage of future revenue, for a period of time, if they send a personalized email to their customers recommending New Day Spa’s business.
- Offer those Old Spa customers a discount for becoming New Day Spa customers and let them know that a portion of their business will be paid to the Old Spa owners.
- Hold “transition” events whereby Old Spa customers can meet and mingle with the owners and staff of New Day Spa.
- Have “alumni” events where the Old Spa owners do “guest appearances” to reconnect and stay connected with their customers.
Old Spa customers are introduced to a “new home.” They receive some discounted services and have a way to express their support for the old owners without it feeling like charity.
The Old Spa owners receive some financial gain from their customer lists and relationships they otherwise would not have. They are offered the chance to stay connected with the people, the community, and the industry they love. And the heartbreak of losing their business is diminished, even if just a little bit.
The CPA is seen as an innovator and problem solver, helping connect people and businesses while helping to stabilize the community. The financial models will need to be prepared and analyzed to determine the amount of a discount to be given and the length of time for a revenue-sharing deal. Maybe the CPA can even participate in a gain-sharing arrangement.
This approach can be used for almost any small business in any community. CPAs know the numbers of their clients’ business. They can help them see and realize the potential value.
There are predatory and opportunistic businesses looking to take full advantage of the crisis. Let’s beat them to the punch. Let’s show our communities what can be achieved and how.
We are all in this together. We can do this.
What are your ideas? How can we get the word out to as many CPAs as possible?
Leave your comments here. Tweet them out @GrowthCPR. Let’s crowdsource ideas and make this a movement. Also, look for more Candemic ideas soon at www.candmic.com which is sponsored by us and our friends at www.k2e.com.
Let’s do this. Because we can and because we care.