The 3 reasons R&D services don’t grow fast enough
I’ve spent all year talking to R&D advisors (both accountants and consultants) about the challenges they face in growing profitable, competitive & ethical R&D services.
What I discovered was that there were three common issues that cropped up in almost all those conversations.
1. There’s SO much competition
The R&D market is still growing strongly, and much of that growth is due to new advisors entering the market. As you build your experience and work hard on doing a great job for your clients, new competitors are continually popping up with lower prices and a wealth of untested confidence. That can cause real problems in winning new business or hanging on to the clients you already have.
Customers are no longer saying “Where do I sign?” when they hear your pitch. They’re spending more time researching and speaking to the range of different R&D advisors out there, trying to find the best possible deal for them. You’ve now got to compete for their attention, and do a really good job of marketing your service, if you’re not to be overtaken.
2. It’s hard to differentiate
The second obstacle is very closely related – differentiation. Standing out in the R&D market can be increasingly difficult, as lots of people are using the same selling messages. We’ve seen all kinds of advisors, with all different levels of experience, saying things like:
- “We’ve got a 100% success rate”
- “We’ve not had any enquiries”
- “We’ve got great technical people”
- “We’ve got a great relationship with HMRC”
The problem is that because everyone’s saying the same things, your clients are going to assume that everyone offers the same service! So they’re just choosing between you and your competitors based on price – which encourages a race to the bottom in terms of quality.
If you really want to grow your service, it’s important that you’re able to show your clients and potential customers exactly what’s different about your service when compared to the rest.
The good news is that the more you know about the R&D scheme, and the more confidence you have, the easier it is to close deals and bring new clients into your R&D service.
3. There aren’t enough experienced people to hire
Because so many companies are trying to grow their R&D service, there’s a lot of competition to hire experts from a limited candidate pool. There just aren’t as many R&D advisors looking for new roles as there are companies willing to hire them. So if you’re hiring top talent, you’ve got to be prepared to spend a lot to recruit and retain new people. You’re in competition with everyone else in the market, some of whom have deep pockets.
For example, the Big 4, and the larger consultancies and accountancy firms, are always going to be able to offer bigger salaries and better perks than the smaller accounting firms or consultancy practices.
So how do you handle that?
Rather than recruiting externally, a lot of R&D advisors we spoke to are planning to grow by training up their existing team. It’s significantly cheaper to work with your current staff than to hire new people, and offering training and development opportunities helps you to retain them long term.
How you can compete, differentiate, and develop your team
The solution to all three of these challenges is to invest in high quality training for your whole team.
Most R&D advisors don’t sell their service on the basis of their training, because there are no formal qualifications for R&D tax relief. One way to differentiate your service is to show potential clients, on your website and in conversation, that you’ve really invested in training and that you have more knowledge and expertise than other providers. Also, if they have complex or unusual projects, then the more you know, the better you can help them.
Plus, the more knowledge your team have about R&D, the easier it is to talk to clients. When there’s so much competition in the market, it’s really important that you’re able to pitch your service and close the sale.
Training gives you knowledge, knowledge gives you confidence, and confidence gets you sales. 😎
The problem is…there’s a lot of different training options out there. Which of them are actually any good?
How to find the right training to grow your R&D service
We’re so determined to help you grow your R&D service we want to give you the full rundown of your R&D training options so you can find the one that’s exactly right for you.
We’ve done the research for you and put together a 15-page guide to show:
- What types of R&D training are available
- How much good R&D training might cost
- How R&D training can benefit your business
- Key things to consider when choosing between different R&D training options.
You can now get immediate access to our “Accountant’s Guide to R&D tax relief training“. It’s designed to help you make an informed and confident decision about which type of R&D training is right for you so that you can grow your R&D service in 2022.
We hope you enjoy it – and good luck with your plans for the coming year! 😀