Increasing practice profitability
In 1994 Bill Gates famously said, ‘Banks are dinosaurs’. The same could be said today of the UK accountancy industry.
For too long accountants have been happy offering traditional accountancy services like accounts, tax and the occasional financial advice. This is simply not enough. With client demands increasing, accountants need to expand their service offerings to compete in today’s marketplace.
This article discusses the building of an outsourcing accountancy practice that not only provides an additional revenue stream but also creates deeper engagement with clients.
This post is going to act as a guiding piece where I can talk about what an outsourcing niche can do for your accountancy practice.
What clients want and why?
The past few years have seen the accountant’s role expand and develop, with practices increasingly being approached by clients for strategic and specialised operational roles. Take for instance, the increase in demand for payroll and auto-enrolment over the last 12 months. There is overwhelming evidence that clients today are turning to their accountants more than ever before. Long gone are the days of the head-down, spreadsheet snooping accountants from the 20th century. Now is the era of the modern, pro-active accountant that significantly adds value to a client’s business performance by delivering services long assumed to be outside their normal sphere of activity.
Clients are time-wary and are looking for a one-stop shop. There is no room for complacency. If you want to deliver value to your clients you need to think of what you do now and what you could do next, ensuring that you stay ahead of the curve and remain relevant to your clients’ business needs.
What does an outsourcing practice look like?
An outsourcing practice is the expansion of a traditional accountancy practice into niche areas for which accountants are approached more often, such as payroll, bookkeeping, management advice, and recruitment.
Accountants have long thought of these services as a nuisance - mostly because of the admin work that comes with it. Fortunately, if handled right, these services can be great strategic initiatives for your firm. UHY Hacker Young, a national group of accountants and business advisors, offer specialist support in bookkeeping, management accounting, and payroll/ human resources to their clients through their sister companies Virtual Business Source, Pay Plus and Recruitment Accountants.
We understand you can struggle to provide these services cost-effectively, so creating a separate outsourcing brand will allow you to market a business with cost base that support a competitively priced service offering.
What can service expansion do for my practice?
There are some tempting advantages of expanding your services offerings, not least the ease with which you can gain insights into your clients business and tell them what’s coming next. This new approach will also provide the following opportunities:
- To create an additional revenue stream
- To promote the production & use of management accounts to help clients become more informed and potentially more successful
- To develop a specialism in a particular sector or industry
- To streamline the production of year-end accounts/tax returns (as a consequence of having better data)
- For practice staff to develop new skills
- To enhance client loyalty by becoming more ingrained into their business
Helping you to grow your practice
It’s easy for me to say that delivering new services can be great strategic initiative for your practice, but how do you go about building a team? What about the knowledge, skills and experience? What about the software and hardware investments?
It may be a bit overwhelming and time-consuming at first but tapping into the power of an outsourcing company like QXAS to handle these aspects of your client’s business makes sense here.
Augmented by outsourcing, even small practices get a chance to compete directly with the biggest practices in their space.
What services can be further outsourced to QXAS?
We can provide you with
- management accounting
- budgets & cash flow forecasts
- VAT returns
- company secretarial services
- payroll administration
- IT support
We have a number of years’ experience in assisting accountants in practice focus on business development and supporting the needs of their clients, by undertaking finance functions for them that would otherwise detract from these objectives.
ICAEW, ACCA and Xero Certified Advisor
Find out more about our affiliations here.
I believe UK accountants are well positioned to promote their own outsourcing service in conjunction with an experienced partner like QXAS. On 13 April 2016, I will be speaking at the West Midlands Practice Conference (BWMSCA) to be held at Ardencote Manor Hotel, Lye Green Road, Claverdon, Warwick CV35 8LT. For directions please follow this link http://www.ardencote.com/contact-us/directions. I'd love to see you there.
If you'd like to get in touch sooner, please email me on firstname.lastname@example.org or call 0758 500 7372.