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Are you a bog-standard accountant?

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26th Apr 2012
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Most accountants with established practices have a mish-mash (sorry, a good spread) of clients built up over a number of years, explains Mark Lee.

Typically the build-up of this range of clients has not been part of any strategic plan. It’s just happened. If the practice owner is happy with their lot, that’s fine.

Challenges

Many accountants complain about the amount of time they spend working and the range of regulatory, accounting and tax rules they need to keep on top of. They also want more clients (profitable ones preferably) and have tried networking, Google ad-words, SEO, telemarketing, direct mail, social networks, advertising etc and are disappointed by the results.

It all seems like a lot of work for little relative reward.

Introduction

Regular readers will recall I have previously advocated the need to have a clear story. To be able to distinguish yourself from the other accountants and to focus on a specific niche or focus. Last October I looked at this from the perspective of client needs: What kind of clients do you want at this time of year?

This time let’s look at the topic from a more conventional perspective. As I explained in the context of new practice start-ups:

“You will secure more clients faster if you are perceived as having a special focus on a specific niche – be that clients in a specific business type (e.g. shop owners, hospital consultants or dentists); those with specific issues (e.g. overseas property, divorce, large family, business start-up) or those willing to use your preferred bookkeeping and accounting software. Most accountants start up with no such focus and simply try to be all things to all people. You will be more successful faster if you have a clear focus.”

Websites

It is astonishing how many accountants claim to specialise in a wide range of client sectors and types.

The website list of their specialisms however is typically simply a list of all those client sectors and types that they have within their client base. Sometimes this will be because the firm has a number of partners each of whom does indeed specialise in different things.

In the case of smaller firms though the list is often meaningless. It would be more honest to say, as some do, that: “We have a wide range of clients across the following sectors….”

Evidencing your specialisms

Those accountants who are serious about wanting to target particular audiences have specific targeted pages on their website. And their adverts, adword campaigns and marketing materials link to the relevant pages.

So if an ad targets solicitors the link goes to a page that references solicitors, the services they require and the firm’s expertise in providing those services.  If someone is recommended to the accountant because they are known to have a specialism in local tradespeople, there is a clear link to a page that evidences that specialism. If the accountant talks at a networking event about the tax refunds they have been securing for people with multiple employments this is supported by a page on their website that reinforces the same message. You get the picture, I hope.

What might you put on these separate pages of your website?

  1. Evidence: Evidence that you really do have a focus on helping a specific target audience. Evidence that you have the expertise and experience to help them. Evidence that you understand their issues, challenges and any specific accounting or tax issues they face. Evidence that they will be pleased they came to you (e.g.: relevant client testimonials).
  2. Contact details: How can they contact you? Who should they ask for? How easy will it be for them to get your advice or for you to take over their affairs?

Existing clients

You may be reading this and agreeing that it makes sense in theory but you still have one big concern. That is, that once you start focusing on a clear niche you will alienate those clients that do not fit.

This is a common and understandable concern but it’s largely groundless. Firstly very few of your existing clients visit your website. Why should they? But even if they do, you simply need to be careful with the wording you use. Until and unless all of your clients fall within your niche, you can note that you provide all of the services that would be expected from a quality accounting practice. And that you have a wide range of clients. However you also have a number of specialisms….

Wide or narrow?

When I was headhunted as a partner in the London office of BDO in 1997 the firm’s strapline was: “Expert advisers to growing businesses”. That was a pretty wide specialism; after all, how many prospects were not growing in one way or another? Despite this focus the firm continued to build its private client practice – albeit that an increasing proportion of such clients were business owners or investors. (Interestingly BDO still dominates Google search results for that strapline even though it ceased to be used in 2003).

A common concern is that by identifying a tight niche you will alienate all those prospects that do not fit. The corollary is that a tight genuine niche will make you more attractive to more of the prospects who fit that niche. It also makes you more memorable as compared to all of the other accountants who are attempting to be all things to all people. And if you are more memorable you are more likely to be referred to when your contacts encounter people who need your services.

Conclusion

Let me finish with an example drawn from the financial services industry. I hope it will prove my point regarding the benefits of identifying a tight niche.

It dates back a few years to when I first ran one of my training courses that help professionals improve the results of their networking. At the start I asked each person to stand up and to give their ’40 second pitch’.

A number of financial advisers were present and most of their pitches were unmemorable. They all seemed to do much the same thing for the same sort of people. One lady IFA however stood out and I remember her pitch to this day. She explained that she helped divorced women over the age of 50 who were worried about their financial future.

I can assure you that every person in the room immediately and involuntarily thought about whether they knew anyone who fitted that profile. You may have done too. And yet none of us would have spent a moment thinking about whether we knew someone who needed introducing to a bog standard financial adviser. It’s the same with accountants. By the way the lady in question told us that she had a wide range of clients but that she had developed this little specialism. I still think it was a brilliant approach.

It isn’t always easy to determine a specific niche or to be able to sum it up in a few words. It can be worthwhile though. And it can reap rewards for you in many ways.

Anyone care to share their niches?

Mark Lee is consultant practice editor of AccountingWEB and writes the BookMarkLee blog to help accountants build more successful practices more enjoyably. He is also chairman of the Tax Advice Network of independent tax consultants.

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Replies (40)

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By justsotax
26th Apr 2012 13:47

Great article .... right on the money....

it would seem some in the industry see having a niche as being a specialist in a number of fields.....and saying as much.  When actually they are general practitioners with experience in a variety of areas.  I guess it is a play on words...but if you are going to use the word specialist then as a practice you should make sure you know the area inside out.  

 

 

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PJ
By paulgrca.net
26th Apr 2012 13:53

Niches
Blond, bearded, one legged acrobats who work two days a week, speak fluent Cornish and where spectacles!

Apologies Mark could not resist it.

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By girlofwight
26th Apr 2012 14:55

Ho hum
My specialism is maximising the income from my practice with minimum effort.

Does it have to be more complex than that?

Or to put it another way, if it ain't broke don't fix it.

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By Mark Lee
26th Apr 2012 17:34

Cheers

@justsotax - Thanks for that 

@paulgrca - Love it - tho not *quite* what I meant ;-)

@girlofwight - I agree, hence my opening comment above:  "If the practice owner is happy with their lot, that’s fine."

Mark

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By carlreader
26th Apr 2012 18:39

Wholeheartedly agree with the strengths of operating in niche...

...markets. We do the same - there's no point trying to be the local accountant as there's always someone £5 cheaper, or with more parking spaces, or established one year before you! Being the 'local accountant' with those qualities differentiates you in no way whatsoever - you are just a bean counter who is a cost to their clients.

 

Mark, I'm happy to share one of our niches as an example - we've obtained probably 90% market penetration in the martial arts industry. I'm also happy to offer a challenge to any firm that thinks that they can crack into this niche and take our place! That's the confidence that being a strong player in a niche can give you.

 

Most accountants consider operating in a 'niche' as being a medical specialist, or a specialist in solicitors, or academies. There's two problems with this. Firstly, they are following the herd, and doing what SWAT / Mercia etc train them to do... Every other accountant is trying this. Secondly, the niche is far too wide for them to reach any form of market penetration, so they'll come up against the same difficulties that they have in their local market. In internet marketing terms, they need to come across a "micro-niche" instead.

 

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By Mark Lee
26th Apr 2012 18:57

Micro-niching
GREAT example Carl. Many thanks for that.
And I am also an advocate of micro-niching. Should have mentioned it in the article but it was long enough already...

Mark

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By carlreader
26th Apr 2012 19:08

Thanks Mark. And to give an easily understood idea of the strength of a micro niche for those who might dismiss it - if I was a sole proprietor, the martial arts industry would give me enough turnover to employ a couple of staff at decent charge rates if using the old-school methods of determining capacity...

I've done the sums, and just two of our niche markets have already given us 5% growth on our total firms turnover for last year, in just three months. PPC, referrals, telemarketing, direct mail, and all other marketing sources have accounted for less than this. And for clarity, we're a decent sized firm, not a two-bob firm for whom 5% growth can be obtained with a couple of meetings - so the spread is wide enough for the statistics to be valid (127 client sign ups in the three months).

However, as Mark says, if you're happy getting what you've always got...

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By Bob Harper
27th Apr 2012 07:28

A few points

@Carl - thanks for sharing that. Would you mind sharing some more information?

What is the average fee?Does being high on the Xero Website for advisors help?What is you best source of leads?

@Mark - I'd like to chip in.

As a marketing consultant, I would not even discuss representing a firm unless they decided to focus on something. The question is what and that often requires some research and thinking.

However, firms do not need to ditch the old; they can set up a brand/Website for the niche. And, the niche doesn't have to be in an industry; it can be a service.

A few phrases have caught over the years:

Laser beam marketing (a bit American but so was John Wayne and he was good)Go for a niche within a nicheInch wide, mile deep knowledge

Established firms who are comfortable- ignore the above.

Start-ups - understand the past doesn't equal the future so do not copy the old.

Bob Harper

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Replying to tom123:
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By carlreader
27th Apr 2012 19:43

Bob...

Bob Harper wrote:

@Carl - thanks for sharing that. Would you mind sharing some more information?

- Delighted to! We've had another cracking day, now at 134 new clients, with one working day to go until the end of our first three months of the financial year, so I'm feeling generous!

What is the average fee?

Together with the stats I've given above, the average fee would be releasing too much commercially sensitive information. Let's just say that certain niches are priced at a premium for our IP, others lower based on economies of scale and systemisation. We're certainly not a cost-leader though, and on the whole are priced at the mid-range, as would be expected of a 'traditional' established firm of our size.

Does being high on the Xero Website for advisors help?

It's generated a bit of interest - however, a good proportion of the leads are price sensitive. Having been long term partners of theirs, we are also seeing the same names come back year after year for quotes. So understanding the software isn't really enough of a pull - it has to be how you use it to supplement other benefits you can give them. To quantify this, we could quite simply become top again by buying more licences (having seen the 'platinum' partners website we know how many businesses he services) - however the difference in leads wouldn't really benefit us and the quality of some of the leads could quite possibly take our important resource (being our management team) away from the business development that provides true value and satisfaction to both sides. 

I think that clients and prospects value our ability to determine the best software solution for them, rather than prescribing the "antibiotics" of Sage or Xero which might be more convenient for us!

What is you best source of leads?

Our niche markets :-) (come on... I'm not sharing everything!) We have a variety of methods that we use within different sectors, and as a marketing expert I'm sure you've got a good idea of what works and what doesn't. I'm happy to say that social media is fast becoming key to our growth, if only to reinforce offline networking. 

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PJ
By paulgrca.net
27th Apr 2012 08:24

Slightly off topic
''we operate a bistro style practice''

How many times do you see that on accountants websites and what an earth does it mean?

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Replying to gbuckell:
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By carlreader
27th Apr 2012 19:33

Bistro accountants

paulgrca.net wrote:
''we operate a bistro style practice'' How many times do you see that on accountants websites and what an earth does it mean?
Never seen it, and neither has Google apparently (when searching for that exact phrase)!https://www.google.co.uk/search?sourceid=chrome&ie=UTF-8&q=we+operate+a+...

I guess that if this phrase is used, they are trying to imply a small, intimate firm service. Marketing b*llocks at it's best. But maybe bistro's could be a good niche for someone? :-)

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Replying to gbuckell:
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By duncanphilpstate
01st May 2012 11:42

A bistro style practice...

... is one where they offer you coffee at the end of the meeting.

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By Bob Harper
27th Apr 2012 20:45

Thanks

@Carl - if you don't ask, you don't get.

Yes, I do know what works but it is great for a successful firm like you to share some knowledge to help the new and young firms who often only hear from traditional accountants who seem to specialise in what doesn't work.

Bob Harper

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7om
By Tom 7000
01st May 2012 12:00

specialism

@ girl of wight 9/10

 

I specialise in getting new clients....3 today and as I type this the first is sitting outside waiting for me....

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By Sloane Walker
01st May 2012 12:36

Help choosing a niche

Hi

The topic of niche accountancy keeps coming up in all the different books I am reading.

I really am convinced that a niche practice is the way forward, 'the specialist always earns more than the generalist'.

My problem is this:  I have a fairly good knowledge in one particular niche, I have spent a number of years dealing with this niche, the problem is is that the type of clients in this niche can be disorganised and a pain!

So, I also have other clients (maybe 16) in another niche (ok it's not a very tight niche, but a niche all the same).  Now the the type of person who runs these type of business is by nature, efficient, good with I.T, they charge a good rate, they provide a service rather than supplies lot's of 'products' etc.  Basically they are the type of client we all like working with!

Now, to become a specialist in this niche, I would need to spend more time working in this niche....so it becomes abit of a chicken and egg situation.  I don't want to call myself a specialist when I am not really....although, that said I do have a good understanding of the issues they face.

Would it be best to research the topic, read up as much as I can, then re-brand/update my website with a new focus on this niche area, cover the issues this niche face....and then transforms my practice into a niche by acquiring these new clients in particular?

Any comments would be greatly appreciated.

Thanks

Dave

 

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By amalonio
01st May 2012 12:39

Cloud services as niche

Very interesting article Mark, it is something that I have been thinking a lot about recently in terms of what is our USP?

As a relatively young person in practice, I'm 31, and working in a family run practice(my dad is the sole partner and my elder brother is on board too) I am keen to look for opportunities to offer something new and to differentiate ourselves from "bog standard accountants".

I have recently, within the last year, introduced Kashflow and Mypaye.co.uk into our practice and to offer these products to our clients. I really have to say these are brilliant software products, so easy to use and with many nifty tools and services.

I see this as a great way to offer a great client experience, reduce cost and be able to really help our clients get what they want.  I am really pushing this as our USP as I don't think a lot of other accountants, at least the ones that I am meeting, are even thinking or doing anything with cloud based products.  I am hoping that this will really help carve out a niche for ourselves as I would ideally like to target young, up and coming businesses and entrepreneurs who are so familiar with technology it is like riding a bike and who will also see the benefit in these products more so than the older generation.  That is not to say these people do not see these products as being very good as the clients we have using these products so far are between 30-50 and are getting on great with them.

anyway I think now the challenge is build our marketing around this idea and really get our name out there.

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By Paul Dunn
01st May 2012 13:37

Saw this yesterday and loved it — great niche + doing it well

It's not often that a website says it so well about their niche — I thought this one was pretty damn good:

http://www.jonathanford.co.uk/

 

 

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By Bob Harper
01st May 2012 13:59

Skin deep

@Paul - shame they have decided to use template content rather than develop their own.

These could be so much better if they did their own:

http://www.jonathanford.co.uk/resources/business_centre/

Bob

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By Hazel B
01st May 2012 16:34

New clients

It's not getting them but keeping them year in year out that counts, then the recommendations just keep on coming.

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By jford
01st May 2012 19:48

Deep enough...
@Paul - thanks for your kind comment. I think you've seen one or two accountants websites by now...

@Bob - I take your point however our stats would show that few visitors delve too deep into the site. I bet you're the first to look at the business centre! Of course we could produce better and more original content if we wrote it all ourselves but we have to weigh up the effort of doing that with the payoff.

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Replying to DJKL:
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By Mark Lee
01st May 2012 21:16

@jford

I will be pointing others at your site Jonathan as I agree with Paul. Really well done!

As for the guides etc in the business centre, your response to Bob's point rather confirms an observation I have made many times. These guides provide very little of value to an accountant's website.

I think they 'might' make sense only where the accountant is providing low-cost sausage machine type services and wants to reduce the need to talk to his clients.  (It's a niche - not a good one, necessarily, but it is a niche). In such cases clients can be pointed at the guides to get background info on a range of topics.  Prospects 'might' go looking for free info on accountants' websites but I doubt these lead to new clients - especially as so few of such guides are branded or contain a call-to-action that references the specific accountant whose site they were downloaded from.

Mark

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By Bob Harper
01st May 2012 20:49

The right thing

@jford - it's a bit of a chicken and egg; boring content is unlikely to get anyone delving.

My bet is that you could produce content that would attract more visitors, get people to stay longer, delve deeper and register for your newsletter. 

Yes, it would take effort and the pay-off could be massive. But, whether you do it depends on your personal goals/motivation, financial and non-financial. Let me ask you this...do you think other accountants can look after your market as well as you can?

If the answer is no then you could take the view that you should put the effort in, not because you need the payoff but because it's the right thing to do.

Bob Harper

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By Mark Lee
01st May 2012 21:14

@Bob "attract more visitors, get people to stay longer,"

You may be right. BUT this is still only worth thinking about if those visitors and people are prospective clients of the type the accountant is looking to win.

Call me a cynic but I doubt that many people seeking loads of free advice guides and who have the time and inclination to hand around on an accountant's website pages are likely to become the most attractive and profitable clients. 

Mark

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By Bob Harper
01st May 2012 21:31

@Mark - you are a cynic

@Mark - it's my opinion that more people are spending more time online and they are looking for and sharing vauable content. 

Bob

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By Maslins
02nd May 2012 10:15

As with a lot of first time accountancy start ups, I initially ignored all the advice to find a niche...why would I be so stupid as to limit my market?!  But of course the reality is if you try to appeal to everybody, you appeal to nobody.

Our "niche" is FreeAgent, a cloud based bookkeeping package on a par with Kashflow/Xero mentioned above.  It's by no means a small niche, they've recently announced getting their 20,000th customer, doubling in the last 9 months.  This indirectly means we're in a niche in terms of our clients' activities, focussing on IT contractors, web designers and other freelancers.  It also means our clients are IT savvy, happy to trust in the cloud and work remotely.  This means we can adopt new technology  to streamline things which impresses rather than scares our clients, and we don't waste much time travelling to/from meetings.

I'm no web expert, but from personal experience I agree with Mark over Bob, that whilst having lots of free advice guides/downloads on your site may bring more traffic, it doesn't bring more clients.  I've even had some people with the cheek to phone me up to get me to explain further some of the guides.  These people aren't clients and have no intention to be.

I've now gone for a simple, design-led website.  Whilst there are some guides on there, they're predominantly so I can point existing clients to them when appropriate, saving me typing out a big essay.

My personal view is that @jford's website is a little "busy", and could do with less text in bigger font on the homepage (again I stress just my opinion)...but the most important thing is if it's working for you, don't change it!

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By Mark Lee
02nd May 2012 10:30

Just to clarify
Thanks to @Maslins for sharing his experience and views re his niche of IT contractors.

I am less convinced when accountants suggest that their choice of Bookeeping software is a niche. It may lead to a niche as in this case. But try telling your business contacts and referrers that you specialise on clients who like your choice of bookkeeping software. It would be like specialising in clients who like the fact you prefer AccountingWeb over Accountancy Age. Or that you use Ariel font rather than Times New Roman.

Yes, you may be able to explain how clients benefit from your choice of bookkeeping software. But few prospects and referers are really fussed with HOW you do your stuff. They just want confidence that you do it and that you do it in a way that suits them. (I appreciate the benefits of Cloud over traditional bookkeeping, but that's as far as it goes for me).

Mark

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By Bob Harper
02nd May 2012 11:01

FreeAgent

@Mark & Maslins - for me specialising in a technology is a niche because you can help users get the most from it and the supporting services/technology that link to it.

By the way, if FreeAgent is the chosen system there is an argument for linking with Barclays Bank because of https://www.mybusinessworks.co.uk/home/ which I think is £10 fro everything including FreeAgent. 

Bob

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7om
By Tom 7000
02nd May 2012 13:09

specialising

I am still specialising in being an ACA,,ie doing accounts and tax returns. I dont sell insurance or JCB's or Holidays...actually I go back to my comment above I specialise in getting clients, they all need tax returns doing they are all the same ie they are not JCB's...sorry must rush have to get a train to london for the new client I am meeting at waterloo...thats the 4th one this week and its wednesday ;o)

 

and I looked at jonathon fords website...ok I guess...does it work tho...less is more??

Cant say much for confidentiallity reasons but THIS works...

http://www.ifabrokers.co.uk/ 

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By Moonbeam
02nd May 2012 14:05

I would love to be in a niche...

One of my excellent mentors explained last year that this is what I should strive for, but it is early days for me and I have to work out what niche I want to be in.

I know for sure that I only want to work for intelligent, solvent people, so that will cut out quite a few, but of course that is not nearly "niche" enough. I had rather stupidly thought in the past that there were few niche areas, such as doctors, dentists, IT and media types.

So when Carl explained his niche was martial arts that was a real eye opener and I could immediately see that there are lots more niches than I had previously realised.

So thank you Carl. I will now have a look at Yellow Pages to see what possible niches I could investigate.

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By Bob Harper
02nd May 2012 14:12

Interesting

@Tom - I understood from a previous post that in 10 years you built a practice with a turnover in excess of £1m and have over 20 staff...is that right?

@Moonbeam - look on the inside, what do you find interesting?

Bob

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By Maslins
02nd May 2012 14:37

Re niche and software - a few things:

- if we specialised in Sage, we'd be one of 90% of accountancy firms, hardly a niche.  FreeAgent's currently nowhere near as mainstream, and certainly wasn't when we went on board with it.

- we don't tend to push clients onto FreeAgent, most clients we get are already using it/are already sold on it through an existing user...so I don't really buy the argument that we push FreeAgent on clients who might be more suitable to something else.

- IMO part of the point of "niching" is to rank well on Google.  Try being number 1 for "Accountants" and you'll struggle.  Carl could perhaps achieve number 1 for "Martial arts accountants"/similar without spending millions on SEO.  Same for us as FreeAgent accountants.  So following the point above, they typically find FreeAgent, then find us because of it.

- I also don't really believe that any accountant can easily get the most out of every bookkeeping package.  They all have their quirks.  By specialising in FreeAgent, we ensure that when a client doesn't know how to do something, we do.  Perhaps worth mentioning at this point that our clients won't have separate bookkeepers.  They'll do the day to day data entry, with us effectively being bookkeeping supervisors.  Therefore we need to know not only how to get the TB to do our year end bits, but also how to use it/fix issues etc.  I'd struggle to do these things on Kashflow/Xero without a lot of playing around...I certainly couldn't talk a client through it over the phone, but with FreeAgent I can, and that adds real value to the client (IMHO of course!)

- plus of course the benefit to us (not the client) that because we're so familiar with it, we can do our work much more quickly and easily...and also get systems in place to automate some basic tasks.

...so on this point, I agree with Bob ;-)

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By Bob Harper
02nd May 2012 15:09

Threats

@Maslins - with every strategy a SWOT analysis applies and if you win them on the software, you could lose them on the software. 

I suspect excellent and free online bookkeeping/accounting software will be available in the UK very soon, which can do everything the leading players can do. 

I also believe the users of online software are well connected and socially connected. And, In my view many will switch to save the £10 to £25 a month licence fee. And, when they do they could switch accountants!

Interesting times ahead.

Bob

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By Mark Lee
02nd May 2012 15:35

Thanks for the clarification @Maslins
In the light of that clarification I tend to agree with you. ;-)

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By Maslins
02nd May 2012 16:28

@Bob, yup, we are vulnerable on the supply side...though I think the demise will come from a different route.

I don't think there'll be bookkeeping software any time soon which is both free and good. Development/improvement costs money.  I don't think it's any coincidence that the three most successful cloud bookkeeping packages (Xero, Kashflow & FreeAgent) are also the most expensive for end users.

If clients believe they'll get identical service for a lower price, then yes, many will move. This in itself doesn't worry me, as many of the clients we win come from a cheaper accountant.  Whilst on the face of it many fixed price accountants offer the same thing (submission of XYZ, unlimited email/phone support etc), how quickly and accurately they reply to client queries, and whether they spot things before they become a big problem is a separate issue, and varies tremendously from one practice to the next.

The threat from my perspective is that either FreeAgent somehow disappears, perhaps due to a major security cockup/merger/similar.  Or (more likely) it becomes more and more sophisticated, and does more of the checks/submissions we currently do, that clients start to question whether they need an accountant at all.

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Replying to Jennifer Adams:
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By Mark Lee
02nd May 2012 20:13

An important point and a challenge

Maslins wrote:

The threat from my perspective is that.. it becomes more and more sophisticated, and does more of the checks/submissions we currently do, that clients start to question whether they need an accountant at all.

The software will indeed move in that direction I'm sure. The challenge is to ensure that clients perceive that they are getting more advice and value from their accountant than any software can provide. If you fear they could reach the conclusion that they don't need you I would suggest you need to be doing more and making yourself indespensible. Which of course is also a different approach to those accountants who just process books and records.

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By Bob Harper
03rd May 2012 07:39

Price

@Maslins - there are other ways to fund free and good software than charging the end user. Have a think about how Google provides free search software.

@Mark - I agree, my take is that the market is dividing into three types of accountants:

1. Added value...local and online - they will be price makers.

2. Compliance new...online and very low cost e.g. small Ltd Co £60 a month

3. Compliance old...local and low cost e.g. small Ltd Co £100 a month

As more people do more things online we will be left with the first two.

Good luck all.

Bob

 

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By Maslins
03rd May 2012 09:31

Hmmm, it's nice to think I add so much extra value, but I think the reality is different.

Don't get me wrong, I'm confident in my abilities, but once software makes it easy for end users to file things directly themselves, a lot will do so regardless of whether they'd be better off getting advice from an accountant or not.

I think the software providers will need to be careful, no doubt with massive caveats "just because our software lets you file things doesn't mean it's all correct".  I worry that the small business accountant's role will become one of unpicking messes when HMRC enquire, as someone who really shouldn't have DIYs.

@Bob, I don't know the numbers, but Google no doubt has hundreds of millions of users.  FreeAgent (as an example) has 30+ staff and has just broken 20,000 users.  Funding 30 salaries out of the advertising on 20,000 users surely doesn't stack up.  Sure, there'll be some cheap & cheerful "developed by kid in bedroom" packages which will be free...but IMHO getting a decent product to match the current big 3 can't be done on a bootstrap budget.  Perhaps I'll be proved wrong.

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By Bob Harper
03rd May 2012 11:20

Google Accounting Software

@Maslins - I agree on both counts, being well funded is key.

However, I believe the model works because after you have built the product the marginal cost is tiny. And, can you imagine the value of the data? Think about it, the provider will know who spends what, where and how much. That is more targeted than Google.

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By Maslins
03rd May 2012 11:43

I think the moment they decide the product is "built" and stop developing it further, they'd rapidly fall behind the competition.

Also, don't underestimate the ongoing support costs. No matter how intuitive it is, you'll need staff to answer support queries.

I know I'd be spooked and reconsider my bookkeeping package if I started getting unsolicited cold calls/emails "Hi, we note you spent £72 on stationery/phone/whatever last month, did you know we could save you..."

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By Bob Harper
03rd May 2012 12:14

Valuable marketing

@Maslins - by built I mean the core engine, they can always tweak and improve but over the user base this is nothing.

I don't think telemarketing needs to be used but what about a report that does automatic cost reduction for businesses? I'd suggest clients would see this as a valuable feature.

Yes, support costs money and it could be the biggest marginal costs but really, how much support does it cost per user per annum?

Out of interest, my take is that current fees charged by the online players are for early adopters, like the costs of a new hardback book. They will come down.

Bob

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