Accountants/bookkeepers face steep competition today as the marketplace is flooded with firms offering compliance and tax services to SMEs. As a result, small business owners have their pick of the crop and tend to take a race-to-the-bottom approach to find their accountants/bookkeepers. This has handed much of the work over to more cost-effective services, allowing offshore and technology-driven firms to erode compliance work profit margins. Adding to the challenges is simple burnout from accountants/bookkeepers churning out compliance and tax clients year after year.
As a result, more accounting/bookkeeping firms look for expansion opportunities. Financial/commercial advisory services can be one of the most attractive and potentially lucrative options. But is this right for your firm? Here we offer tips to help you decide whether or not the financial/commercial advisory services journey is right for you.
DO YOU HAVE THE RIGHT COMPLIANCE TEAM?
To introduce financial/commercial advisory services, you need someone to champion the new service. This is the only way to ensure it is implemented properly. You need a team (or person) in the wings to continue handling compliance. When you have the right compliance team to keep up with compliance and tax-related jobs, you can assign the right person to lead the charge for the new service. Someone completely free to focus on building the new aspect of the firm is more likely to succeed, allowing the firm to gain momentum and keep the advisory services available.
Although a partner doesn’t have to be directly involved with the nitty-gritty of the venture, they do have to play a supervisory public relations role. This encourages clients to want to use the service. Unfortunately, it’s not uncommon that when tax lodging time rolls around again, the new service falls by the wayside. Clients who were benefiting from your monthly business review meetings can’t be pushed aside because the busy season has arrived. Therefore, you need to define roles to meet the existing need of your clients while remaining committed to the organised advisory meetings to maintain the new area of the business.
CONSIDER THE MARKETPLACE FORCES IMPACTING COMPLIANCE
If your firm is up against the other guys who’ve taken it upon themselves to look at more cost-effective, service-focused ways to grow their business, you can really miss out on your share of the market. Factors such as outsourcing offshore, technology improvements, and communications technology empower your competitors to take the lion’s share because they can reach a broader client base.
If you look at technology such as Zoom, suddenly you expand your reach and can offer financial/commercial advisory services for clients situated anywhere by accountants/bookkeepers situated anywhere. However, technology is something that requires knowledge to ensure you can rise to the occasion and provide advisory services that meet the needs of your clients, disruption-free.
DO YOU HAVE WIDESPREAD INDUSTRY KNOWLEDGE?
Your financial/commercial advisory representatives need to also develop an interest in various types of businesses. It isn’t possible to offer business advice to a business owner without a deeper understanding of their industry and the purpose of their business. This goes beyond “number” insights gained from preparing annual accounts and income tax returns.
Instead, you need a group of people determined to keep on top of specific industries, reading the Financial Review each day, researching different types of industries, and developing some expertise in individual industries. This is the only way to become adept at offering business advice. You can’t be well-versed in every single industry, but you can choose areas to specialise in and carve out a niche for yourself. Small business owners are looking for someone with experience that provides them with the same level of insights that would come from a CFO in a large corporation.
CAN YOU CREATE CORPORATE-LEVEL PROCESSES ON A SMALL SCALE?
Big business is driven by a series of micro-businesses that might be departments or regional offices. Managers and clerical teams administer the group of businesses and prepare reports that allow the higher-ups to make informed decisions. Can your team create the same types of processes for your clients on a smaller scale? Ask yourself if you have the capabilities to produce and advise on:
- Weekly performance reports
- Weekly key performance indicators
- Monthly financial accounts
- Monthly key performance indicators
- Hold monthly business review meetings
Without an understanding of these processes, it becomes very difficult to discuss the implementation of a scaled-down approach to this setup with your clients.
An introduction methodology that has been used and is recommended by Andrew Geddes is that you introduce one or two clients at a time, preferably from an industry that your key person has knowledge of.
Within the ESS BIZTOOLS PRODUCT PACKAGE our Subscribers are supplied with a set of guidelines relating to the introduction of clients to financial/commercial advisory services and our training packages include guidelines to assist your start on this exciting journey.
CAN YOU ANSWER YOUR CLIENTS’ “WHAT IF” QUESTIONS?
Business advisors require a certain amount of empathy for the problems their clients face. Challenges tend to bring up “what if questions” that need answers from a person of authority and knowledge. Your financial/commercial advisory service needs to address typical and not-so-typical challenges small business owners face so that you provide the answers to their ‘what if’ scenarios. Again, you become the CFO for the small business, providing advice and insights that instigate data-driven, thoughtful decisions for their success.
DO YOU HAVE THE EXPERIENCE AND SKILLS?
This is a major factor in whether you should consider financial/commercial advisory services. Today, soft skills such as interpersonal skills, communication skills, and even public speaking skills must be combined with a comfort level using technology. Not all accountants/bookkeepers are born with these skills, and in fact, many found accountancy/bookkeeping as their calling not just for a love of numbers, but also a lack of these soft skills. So the question is, do you have the soft and technical skills to provide a service based on communication and availability to your clients? As mentioned, it’s not like a partner has to be the one providing the services, but optics demand some form of supervisory, public-eye role. It comes down to character traits that make it easy to converse, offer advice, make presentations and be “available” for clients to run a financial/commercial advisory service successfully.
If you feel you want to pursue financial/commercial advisory services, but you lack the soft and technical skills required, it’s never too late to seek training. You can improve your public speaking skills by joining organisations such as Toastmasters and participate in Zoom training sessions to improve your knowledge and understanding of the utilisation of the Zoom communication tool.