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Three reasons why your accountancy firm isn’t growing

6th Oct 2023
Brought to you by
iris

IRIS makes accountants more efficient and productive.

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Accountants are busier than ever, yet capitalising on rising demands remains an issue for many.

To-do lists have stretched longer than most people’s arms, and amidst the current economic instability, client demands remain catastrophically high.

So, with an influx of activity, why does growth remain a pertinent challenge?

1) Underselling the value you offer

With the cost-of-living crisis and continuous economic uncertainty, pricing remains an emotive subject.

Since the pandemic, many firms have relentlessly been going above and beyond to support clients with advisory services, often at little to no extra cost. 

However, it’s critical to charge appropriately for the services you deliver. 

Recruitment has become more expensive, and the general cost of doing business is much higher than half a decade ago.

Some accountants we spoke with haven’t increased their prices for 5-7 years! For your firm to thrive and grow, you need to adapt your offering and be paid appropriately for the value you deliver.

Frankly, if your pricing doesn’t adjust with the times, growth will always be an issue. 

Podcast: Accountants - know your worth and get paid for what you do!

How to increase your pricing

Consider trialling a new fee structure on a selection of low profitability, high-demand clients – think the clients who keep you up at night constantly pestering you but also pay peanuts.

Frankly, if you were to lose these clients due to the new fee structure, it wouldn’t be the greatest loss, so they’re the perfect demographic to test this on.

Should a client respond badly to this news, think of it this way: you’ve increased your capacity and average profitability by losing them. 

Also, try to take a fluid approach.

Review the feedback and modify your pricing approach before implementing fee increases more widely. 

For more guidance on modifying your pricing and capitalising on advisory services, read this blog.

2) Staff are going, going, gone

Gosh, we’ve been speaking about the talent shortage for so long now – it’s no longer a crisis but the new norm, which we must all adapt to.

Accountancy Age reported a skill gap of 22%, and the ICAEW cited a 36% drop in the number of accountancy applicants year-on-year.

The story continues.

We spoke with the 35 top UK firms and discovered that 42% are concerned they can’t retain talent, and 32% cite their current skillset as a barrier to growth.

What options do you have? Some may consider throwing money at the problem to entice employees and prospects.

The CIPD stated:“British employers are increasingly making counteroffers to keep staff who are tempted by higher wages from rival firms.”

Let’s face it, with the current economic climate, many of us aren’t realistically in a position where we can simply resort to outbidding every other employer, so what are the alternative options?

Become an attractive employer

Firstly, we’d advise you to focus on making yourself an attractive employer.

Jargon aside, what this means is creating a workplace that meets the needs of a modern workforce.

For example, using software which automates admin-heavy tasks and enabling remote working through cloud technology.

Additionally, in a recent survey, we uncovered that 50% of people view career progression as the most important aspect of a role, so offering development opportunities, whether that’s additional learning or promoting internally, is vital.

Explore outsourcing  

The second option is to utilise outsourcing services.

Offload your more time-consuming, admin-based tasks to an outsourcing service, freeing you and your people to focus on more value-added work.

Not only does this approach help with growth and workloads, but it also plays a part in making you a more attractive employer as you’re able to offer staff greater fulfilment and more meaningful roles.

3) Succumbing to inadequate software

A recent AccountingWeb article discussed the topic of technology and whether it is helping accountants, opening with the quote: “My firm has technology coming out of its ears, but we’re still too busy.”

This is an issue not exclusive to the AccountingWeb commenter.  

There are two sides to this coin.

Part of the issue is simply inadequate software, which doesn’t deliver the value promised.

When staff are bogged down with manual processes, it’s no surprise they can’t find the time to offer more value-driven services that would help the firm grow.

Seek software which utilises effective automation to give staff the time needed to make a difference.

On the flip side, firms are also suffering from an app-ocalypse, where they have too many applications which don’t speak with each other.

We asked our audience, and nearly half stated they are suffering from app overload, and 72% wished their apps connected with each other.

A lack of software integration in your tech stack forces you to jump between your various applications, consuming more time and creating an added risk of human error. 

Fear not! See how our cloud-native solution, IRIS Elements, is solving the industry patchwork problem.

Change how you operate to reveal the real you

Accountants are often the unsung heroes of the economy – you deliver incredible services.

But when you’re bogged down, operations can grind to a halt, and it can feel like you’re stuck, sinking in quicksand.

By rethinking how you work, you can reinvigorate your firm and flourish, helping you not only grow but also deliver a better overall client experience.

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