Accountants as a platform

Accountants as a platform

"A platform is a group of technologies that are used as a base upon which other applications, processes or technologies are developed" - Techopedia

I want to share my frustrations with you.

As a small business mentor and product manager building products for small businesses, I get to speak to a few business owners regularly (on average 3-4 x week for the last 6 yrs!) from a one man band photographer to tech start-ups with reasonable amount of funding. These types of discussions are known as user research sessions. It's an attempt to build empathy for business owners and try understand what they do, how they do it and the challenges they're facing.

During these sessions, I attempt to uncover pain points the business faces. Specific problems such as, ''I have to manually calc CIS tax deductions which sucks and I always get the calc wrong'' to general business problems ''cashflow is a problem because my customer is a pub and they have their own cashflow problems''.

Here's the thing....<The issue>

I've been asking the businesses I talk to what they have done to solve these problems themselves and who they have reached out to for guidance.

The most common responses are-

  • I googled my problem and found a solution

  • I have other friends in this industry, I asked them

  • I saw an ad

  • and on the very odd occasion a business owner declares that its their accountant who has provided guidance, support and mentoring for their business. 

"A lot of these businesses have accountants, why the **** aren't they asking them for guidance?!"

Unfortunately it's around 1/10 businesses I come across who use their accountants in this way. For problems relating to tax and HMRC letters yes, they always remember their accountant, what I'm saying is these types of problems are not the key issues SMBs face on a day to day basis! 

Just 1/10 SMBs go their accountant to ask for their help to solve problems they face regularly related to their business, that hurts.

So why only 1/10? <I found out>

Top 3 reasons businesses didn't seek guidance from their accountants-

  1. I didn't know my accountant can help me in this way, I only meet them a few times a year <pisses me off when I hear this>

  2. My accountant didn't ask me anything around my business beyond my taxes and paperwork.

  3. My accountant doesn't know anything about tech and funding right?, he's only my accountant.<somewhere in the world a kitten dies every time a business owner says this>

I read the top 3 reasons above with another lens-

  1. Lack of proactive guidance and help by my accountant

  2. Lack of interest shown by the accountant in my business, they only care about taxes and accounts.

  3. Lack of awareness around the services my accountant offers and how they can help me. They don't have a website, they only communicate via phone calls once a quarter and when there is a problem with HMRC.

Why is this a problem?

Quite simply, your clients are facing issues which you as finance pros can help solve.

Business challenges over the long term can impact you too, if you're worried about clients squeezing fees every year, the lack of support from you and the perception this carries will not help you avoid these awkward conversations around fees.

Churn is becoming a bigger challenge, go online and you will see many firms leading with cheap prices for their services, if the perception of your client is that you only do taxes and accounts for them, why won't they go with Bob' <not real...yet> for a tenner a month to get the basic taxes and accounts done for a quarter of your price.

You're missing out on your best sales channel. Word of mouth referrals are hands down the most effective ways we financial professionals gain new clients.

A year ago I undertook some research in my family's firm and now see over 60% of our clients who we took on over the last 12 months referring their family, friends and colleagues to us for their company and personal tax returns (screw you NPS surveys!). This is primarily down to the expectations we have set from the outset, the services we provide (Not just stat accounts and tax returns), our value based pricing and the use of technology to genuinely help their business (people counters for our restaurant owners and a Yelp business presence to integrating their software systems via API hooks or simply IFTTT)

What can we do?

Become a Platform. Yes, become a platform.

A reminder of the definition-

"A platform is a group of technologies that are used as a base upon which other applications, processes or technologies are developed" - Techopedia

Here is my definition-

''A bloody good finance professional who uses their knowledge of finance and accounting as a base upon which other services are provided to small businesses such as technology consulting (directly or indirectly), funding guidance and biz growth mentoring in order to help them succeed''

How to become a platform?

Review the services you provide today -

  • Sit and think about the last 3 clients you have completed work for, list out all the jobs you carried out. For e.g you completed a set of accounts for ABC ltd, the other jobs you carried throughout the year were, VAT returns every quarter, monthly reconciling, bookkeeping, technology set up, software subscriptions, software support, clean up of prior year accounts, registered office etc

  • Now think about how you presented these services to your clients, was it rolled in and assumed by your client? did you charge for these additional services? Did you at least breakdown these services when you presented your invoice / engagement letter so your client knows all the awesome services they're receiving?

  • Could you have supported your clients in any other way, did your client know you can provide other services?

Review your perception and brand-

  • Get a friend or family member to review your website / office, ask them what they think you do and offer small businesses and ask them what your typical client is like (the type of business, age of the client)

  • Now look at some other accounting firms websites 3 of my favs - LiveCaTheWowCompany and 5waysgroup look at their awesome branding. What type of client do you think are attracted to them? Do they focus on just accounting or are they offering other services to their clients, thus acting as a platform for their clients.

Your mindset-

  • Break away from rolling in all your services and just explaining to your clients that you're simply doing a set of accounts for them. Look at what jobs you carried out over the year, are your clients seeing the effort and all services you provide them? if you don't explain the value you're providing them, how can you expect them to see value.

  • Don't be afraid of showcasing your platform. I've come across many accountants who work closely with mortgage advisers, IFAs and their local business bank managers (many accountants have been doing this is for years, you're basically acting like a platform, are you promoting it?) 

  • Be an open platform. Many accountants understand technology (QBO/Xero and 3rd party apps) and provide a tech review for their clients. What if you had complex tech challenges for your client?. Be open to outsource more complex queries to 3rd party tech consultants. My family's firm work closely with a digital marketing agency and have referred this agency to help clients build their websites, design logos or build visual assets for marketing. Our platform is open and benefiting our clients immensely.

  • Learn, learn and learn. Learn new skills and empower your team to do the same. If you have a phobia of tech or don't quite understand R&D tax credits, learn it and offer it to your clients. The bits which seem too complex, outsource and build a network.

Skills in house vs outsourcing -

  • You need to up-skill your team if you're not providing other services beyond compliance work. It's not difficult to provide services such as forecasting, debtor management and in some cases, investor introductions. At Propel by Deloitte, we offer this service to our clients thanks to networking, attending start-up events and adding the right people on Linkedin. 

  • There are some services you may not want to learn and simply do not want to offer, one such service is a complete technology consulting service where you build integrations and custom apps for clients. Outsource these to the experts but as that intro is coming from you, that service is part of your platform.

Ask the right questions -

  • How well do you know your clients and their future aspirations? Can you identify future opportunities to help your clients with services beyond accounting. How can your platform help your clients in the future as they change/evolve.

Best of luck and remember, you've been a platform for many years. It's now time to shout about it.

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