What are Accounting and Tax Prep. firms doing to grow their business right now?
Throughout May and June, Pransform interacted with over 1,000 Accounting and Tax professionals at New York, New Jersey and California Accounting shows; and at AICPA Tech Plus at Las Vegas and then at Scaling New Heights at Orlando. We compiled a list of several feedbacks and figured out the “Top 10 Firm Growth Initiatives of 2013” that Accountants have implemented to grow their firms.
The secrets are revealed here, in no particular order of importance…..
Adding New Revenue Streams: The undercurrent in discussions, especially with Tax Prep. Firms, was that tax season was difficult, clientele reduced because many eFiled themselves and cutthroat pricing pressures in their neighborhoods. Some firms were not too keen doing books for their clients two years ago but now they are thinking how to get such additional business from existing clients. They are adding new revenue streams.
Emerging Revenue Opportunities Not just getting back into traditional segments, Accountants are actively analyzing emerging opportunities e.g. healthcare reforms. They want to understand it deeply and get into advisory roles with their clients on the financial impact on businesses.
Networking Social Media, Meet up groups, local Chamber of Commerce, Community groups – Accountants are investing more time in actually reaching out, not relying as much on referrals as in the past.
Cloud and Hybrid Infrastructure More firms are saying that the percentage of their work moved to cloud had increased compared to last year. Accounting, or taxes or document management – at least some part is now on cloud . So a “hybrid infrastructure” model has emerged. Cloud has covered more ground over last 12 months. It’s helping firms to get clientele from geographies outside their locations. And the “mobility” is helping firms save commute time and use it to service more clients.
New Business Models While hybrid model emerged for firm infrastructure, the core business models are changing, even if incrementally. In line with “adding new revenue streams”, firms have been trying to acquire new skills, including acquiring different types of practices that add to their current services offered. More firms are exploring new business models to cut down costs and optimize their capital investments.
Technology, as Always Many visitors to Accounting shows spent more time getting to know about new features in their current softwares and of course, taking a deeper look at new ones. Interestingly, some of them want to develop their own internal process management technologies because they “do not want softwares to dictate what they do and how they do it”. Cloud has also made it possible for even smaller firms to provide higher value services as the entry barriers have been lowered with pay-as-you-go choices.
Staffing: Temporary, Permanent and Shared Students, part timers, stay at home moms – firms got help from many of them, especially during tax season. But the “dominant worry” was that review of work done by “non-experts” was causing firms’ best brains stretched and stressed. AICPA’s PCPS 2013 survey results show that firms of all sizes (except for sole practitioners) are facing “staff shortage at all levels” as one of the top 5 challenges. In our brief survey, 46% small firm owners said they don’t have time for marketing or they can’t find good staff, which uncovers staffing blues. Shared resources utilization is one thing that many accountants are exploring.
Knowledge Monetization More firms expressed that they are trying to articulate how their “specialty knowledge” helps clients better than their competitors. Technological choices available now seem to make a strong case for accounting and tax professionals to invest even more in acquiring knowledge and move up the value chain of services offerings, especially advisory and consulting.
Niche Specialization Dental Accounting, Accounting for Outdoor Enthusiasts, Restaurant Chains Accounting. Niche specialization seems to be gaining ground.
Thought Leadership Through Social Media Not restricted anymore to big firm top executives. Social media, LinkedIn etc. can be seen abuzz with people posing their accounting problems on group discussions and accounting / tax professionals s are showcasing their knowledge by answering those questions. More accountants are building their brand through social media knowledge sharing. A quick search with keyword “CPA”, for example, shows a large increase in the number of results shown on LinkedIn – thereby indicating that more professionals are active on Social Media now.
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