I recently had a conversation about Succession Planning with an Accountant that I knew. I asked him what his plans where when he wanted to retire. He happily informed me that he would sell his client list and reap the rewards. I agreed with him that his assets consisted of a series of relationships but challenged him on how loyal they would be.
I suggested 50% of his client would discontinue the relationship with the new owner almost immediately and the others would dwindle away over a period of time, reducing the value of his treasured list. He became quite protective of his prized database, but I explained further what I meant by it.
I suggested for example, that if the dentist he used decided to sell their practice, it would create a change point where their clients would have an opportunity to re-evaluate their relationship with that surgery. After all they would have no knowledge of the new dentist. They would have a choice, either to shop around for a new dentist or give unknown loyalty to the new business owner. They could possibly opt for another surgery that was either nearer, cheaper or by referral, but whatever the outcome an indirect choice had been given to them.
The accountant’s business was no different; he was trying to entice clients because of what he did rather than why he did it. He was relying on the commitment of his clients without giving any emotional value back. He wasn’t trying to get his customers to engage with his common cause or believes, so there is no tangible reason why should they remain loyal.
He had made himself a commodity within own business and the possible demise of his life’s work didn’t make him feel great. He started to realise the need for emotional satisfaction for himself and his customers that would satisfy their existence. He had to create an engaging commitment that was far more than money alone. He had to find a way of getting his clients to buy into his passionate for business and why they should remain loyal to his brand, even after he had gone.