Why your profit is a direct result of the value you add to your clients.
Whilst many service based businesses can turn a healthy profit by following a similar strategy to their competitors, the most successful businesses understand their bottom line is a direct result of the value they add to their clientele.
Take for example an average accounting firm Melbourne, should they merely prepare tax returns, they will be no different to any other Melbourne accountant, they will be replaceable and are subject to the laws of supply and demand.
By not adding additional value, your business will be competing on a price/quality ratio, ie businesses of comparable quality will be heavily price driven and success will be a result of the efficiency of your business (this is where efficient systems come into play and traditional business advisors can maximise the efficiency of your business).
Whilst there is nothing wrong with this approach, as the world is still very young with a plethora of riches to be earnt, a better way (along with maximising the efficiency of your business), is to add greater value to your clients.
By adding greater value to your clients, you are no longer competing on price with your competitors and your clients will be willing to pay what they feel you are worth to them.
If an average accounting firm Melbourne is saving the client twenty thousand dollars via reactive means, however your accounting firm Melbourne is saving your client $200k via proactive means and advisory, it is in the clients best interest to pay more in accounting fees to save a substantial amount of money.
The more value you add to your clients, the greater the benefits the client receives and the greater remuneration you will receive. In addition to greater remuneration, your clients retention will be greater as well as satisfaction levels with your organisation, which in turn will lead to greater leads via word of mouth.
To summarize, focusing on adding value is a great way to build a standout business with a huge comparative advantage over other similar businesses, and should be a substantial focus for any business.