Many accountants I speak to are surprised to discover that there are over 23,000 legal entities supplying accountancy services in the UK and 55% have an annual turnover below £100,000. Is this because they are happy running a micro business or do they not know how to grow their business?
The forecasts from economic commentators such as the Henley Centre predict that there will be an increase in small businesses which is a great opportunity. But, at the same time a number of factors may contribute to overcapacity in the accountancy profession including:
• Increasing use of computerisation
• Better software
• Simplification of reporting
• Increase in the number of accountancy firms
• Bookkeepers moving into Self-Assessment work
Firms are responding by broadening their range of services. Marketing for accountants means higher level services such as more sophisticated and agressive tax planning, personal financial services, business advice as well as basic services like bookkeeping and Tax Credit claims. Some firms are developing service specialisms while other target specific industries.
Interestingly, the smaller firm will have 90% of sales from compliance services whereas larger firms may have 50% plus from management consultancy.
The answer (if you want to grow) is to specialise and/or widen your service range. The phrase we like offer a wider range of solutions based on a deeper understanding of clients business. This goes down well because what the Sage Accountant Business Collaboration survey found was that business owners value most is an accountant that understands them.