Why I Keep My Bookkeeping Service So Simple, Even When It Causes Me to Lose Clients

In a word, the answer is “variance”. 

A bookkeeper delivers two standardized reports: the Profit and Loss and the Balance Sheet. Since the reports are standardized, you’d assume the processes that produce them would be easy to standardize…especially with a client base as homogeneous as mine: I work almost exclusively with life coaches who sell similar products in similar ways.

And yet…

Variance between clients leads to an ever-growing set of edge-case requirements that fall outside my “standard operating procedure”. 

As the number of clients grows, the pain of the edge cases grows exponentially. When my service reached around one hundred clients, I experienced a shift where the majority of my working time was spent addressing individual client requests and requirements that fall out of my previous definition of “normal and expected”.

My response to this realization was, “No problem. This is solvable through good documentation, good hiring, and good training.” 

And, yes, this would be the solution for a bookkeeping service who wants to scale indefinitely. There are (at least) two challenges to overcome:

1. The documentation is ever-changing and client-specific.

You have to create a space for every client to have their own documentation (easy enough) and then you have to systematize the recording of client-specific notes (more difficult), and then you have to systematically check and update the client-specific notes so they stay correct and useful (very difficult, alarm bells should be going off in your head).

And you’re doing all of this to accommodate client uniqueness that is questionably beneficial to them and unquestionably costly to you. 

2. Team member turnover is brutal.

It’s one thing to find, hire, and train a person who can work in this surprisingly dynamic environment. It’s another thing to retain them. 

A person who can manage all this ends up doing it in their own business. No joke–I have three former team members who left to start their own business in a similar space. (I’m happy and proud of this. I love self-employment and I’m happy to know I helped other people get started in the same way other people helped me.) 

But the net effect is you end up employing people who require enough oversight that it feels like less work to do it yourself. Is this solvable? Yes. Is that what I want to do and be when I grow up? No.

The Flexible Service Happiness Paradox™

When you allow small differences in client requirements to creep in and grow, the service gets more fragile and starts to break down. 

Here’s how it goes:

  • The client asks me to be flexible. I accommodate the exception, thinking it’s the “good service” way.
  • My processes aren’t good at handling exceptions (the more exceptions in a process, the less it becomes an actual process and the more it becomes a set of one-off tasks).
  • One-offs are easy to miss, hard to execute, and often involve the participation of the client (which is a disaster).
  • I fail to meet the client’s expectations. The client feels disappointment. I feel guilt and embarrassment.

This is the great paradox of my business:

The clients who ask for and receive accommodations end up being the least happy (and often end up leaving the service anyway). The clients who conform to my ideal workflows are simultaneously the easiest to serve and the happiest. 

It took me ten years to see this cycle clearly.

The Let’s Do the Books Way

I’m left with two, maybe three options:

1. Continue to be flexible and handle all the exceptional requirements by growing a team, embracing the challenges of turnover and creating my own competition. This is not the right fit for me.

2. Continue to be flexible without growing a team, which leads to more mistakes, more unanswered requests and emails. I’ve tried this. I’m done.

3. Choose the short-lived pain of asking clients to conform to specific structures and workflows in their business, and feeling okay when many of them go with another service provider.

To be clear, I don’t feel entitled to any of my clients’ patronage, and I don’t resent anyone who wants a more bespoke bookkeeping service. 

And that’s where I am today:

I offer a highly-standardized, reliable, runs-in-the-background service at a very reasonable fee for life coaches whose financial structures and habits allow me to promise them a good result and a good experience.

…and happily send everyone else to find a solution that’s a better match for their perceived requirements. 

If you’d like to skip ahead, here’s a link to tomorrow’s message (which describes the ideal client of this service).