Sobell Rhodes has an enterprising approach to filling gaps in its services requirements: rather than buying them from someone else, it sets about acquiring the skills and expertise first to fulfil its own needs, and then to sell those services to other businesses. “It was a conscious business decision,” says managing partner Andrew Rhodes, “to turn as many of our costs as possible into profit. It didn’t make sense in the long term to keep spending on IT, on training, on being part of an international network, when, with a bit of forward planning and an initial outlay, we could not only eliminate those costs but actually turn them into income generators.”
First off was a global networking division, the International Network of Accountants and Auditors (INAA). Founded more than 20 years ago, it is now the 12th largest such organisation in the world with 150 offices across 50 countries and six continents. Then, 18 years ago, came Sobell Rhodes IT Solutions, a joint venture with a small IT business specialist that provides integrated IT and accountancy services. Two years after that, the practice set up its Continuing Professional Development arm, which now trains more than 50 firms and 1,000 delegates per year.
Diversifying into related areas has given the practice a boost but it remains what it has been since it was founded in 1995, an exceptionally good provider of core accountancy services but with an eye on strategic expansion and development.
“Tax was our starting point,” says Rhodes. “When Melvyn (Sobell) and I set up, we were all about compliance. We’ve built on that, now 40% to 50% of our work is consultancy and advisory.”
It also covers the fastest growing and the highest value area of the firm’s business, its forensic and expert witness work. Headed by Sobell, a member of The Academy of Experts and an accredited mediator of the Centre for Effective Dispute Resolution, the forensic team advises in personal and corporate cases. This has led to another core specialism – acting for solicitors. “This has given us the opportunity to develop our expertise in legal accountancy. We’ve become specialists in mediation and in divorce arrangements, acting for divorcees and their solicitors,” says Rhodes.
The firm saw a 12% increase in income last year – partly through gaining new business but mainly through selling relevant growth-propagating services to existing clients. “We identify businesses that would benefit from a more enhanced service, such as our business growth programme, and elevate them from a compliance package to a consulting one. We only up-sell when we know additional products will improve the financial health of our clients,” says Rhodes.
Staff numbers have also increased substantially – by 24% over the past 18 months, taking the total to 40, including seven partners. This, and the plan to recruit another 10 people by the middle of next year, precipitated a move to a larger, open-plan head office in Elstree. (There are also two smaller branches in Watford and central London.) Rhodes is cautiously confident that Brexit will not damage business. It seems to be giving them a boost, at least for now, bringing new clients to their door who are concerned about the likely fallout.
New business, close to 98%, comes from referrals, which result from forming strong alliances with like-minded businesses. “We’re a very co-operative firm,” says Rhodes, “and are generous with our knowledge, expertise and recommendations. We belong to several peer groups, which creates its own momentum. We meet people whom we can refer and they in turn recommend us. We assiduously follow every lead.”
The firm has 900 clients. In addition to legal and divorce, its other key fields include property and building, and charities and not-for-profit organisations. “We have a special interest in the charity sector professionally,” says Rhodes, “but also because we take our social responsibility very seriously. We do a lot of work on a pro-bono basis and also offer discounted fees to charities. It’s part of our commitment to leave a positive impact on our community.”
Being good, being principled, acting at all times with integrity and excelling in customer service are the firm’s defining characteristics, a fact borne out by its extraordinarily high client and staff retention rates – both around 98% in 2016. “It matters enormously to us that everyone we work with is happy with us,” says Rhodes. “We constantly monitor our customer and employee satisfaction, with a view to improving what we do. We use Net Promoter Software to measure client happiness and our latest score on that was 90%, but we want to do better.
“And we have a similar approach to our staff. It’s incredibly difficult to find good people who share your values – actually harder than finding good clients – so we do all we can to keep them with excellent career prospects, social events and initiatives such as our ‘Awesome Monday’, where we recognise and reward people who have excelled over that past week.”
Sobell Rhodes is a multi-award winner: The National Practice Excellence Client Service Firm the Year, 2016; British Accountancy Awards Independent Firm of the Year, 2012/2013; WOW Small Business winner, 2011 (the only national awards for customer service based solely on client nominations). Rhodes seems most proud of being a gold standard Investors in People business. “Only 7% of businesses have been awarded a gold, so yes, I really am very pleased about that. That’s what we’re all about – being a good firm to work for and with.”
“Trust and common values are the most important factors in running a successful and harmonious practice. When these factors are missing it’s led to difficult and costly partnership break-ups, problematic client relationships and serious employee issues. Trust your instincts.”
“Regularly ask ‘How are we doing?’ and ‘What can we do better?’ Our feedback systems give us the motivation to improve what we do and how we do it. Also, when clients know they can be completely open with us, our relationships become even closer and more enjoyable.”
“Be happy and don’t act for problem clients. The main sources of aggravation and unhappiness are clients who are either difficult to work with or who become unprofitable. In the past we’ve tolerated these situations but nowadays I find it’s much better to have a frank discussion and if we can’t work it out, agree to part amicably.”
“Developing in-house advisory services in high value areas such as forensic, expert witness, business valuations and mediation substantially boosted our fee income, helped clients in problem situations and created a flow of referrals from professional firms, including other accountants.”
“Belonging to a peer group has been a unique way to forge mutually supportive relationships with fellow accountants. I’ve found it an invaluable forum to share challenges and problems I encounter in practice and benefit from each other’s experiences and different viewpoints.”
Keys to success
“Sharing our written annual strategy plan with our whole team. We always ask an unconnected person to facilitate our six-monthly strategic review days so we receive an independent opinion and don’t dodge important issues.”
“We guarantee service excellence, which means we avoid being judged on our fee structure. Our service commitment sets out our primary service pledges and is publicly communicated to all our clients so we deliver what we promise.”
“The Investors in People quality standard has given us a structured framework so everyone understands our aims: what we want to achieve as a firm; how they can contribute; the skills and training needed; and integration with their career plans.”
“Give referrals to get referrals. We’ve developed many systems to create referrals but one of the most successful has been to recommend our clients and introducers many times by using the advanced functions in LinkedIn. They then reciprocate in the same way.
“We use a structured system to help clients achieve their personal and business goals. From the start of our client relationships we systematically and regularly ask clients what they want to achieve. Thereafter, we use a selection of advisory toolkits to help fulfil these. Over and above being their compliance accountants, we are an important contributor to their future growth and wealth creation.”