How accountants can become a platform and help small businesses beyond accounting

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

As a startup mentor and product manager building products for small businesses, I get to speak to a few business owners regularly (on average three to four a week for the last six years!), from one-man band photographers to tech start-ups with a 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 to understand what they do, how they do it and the challenges they're facing.

During these sessions, my intention is to uncover pain points the business faces. Specific problems such as, “I have to manually calculate CIS tax deductions which sucks and I always get the calculation wrong because I can’t always remember if the subbie is registered or not'” to general business problems '”cashflow is a problem because my customer is a pub and they have their own cashflow problems, which means I always get paid late whilst I have to pay my suppliers on time!”.

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
• On the very odd occasion, a business owner declares that it’s their accountant or bookkeeper who has provided guidance, support and helped solve the problems they face.

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

Unfortunately, it's around one in ten businesses I come across who use their accountants in this way, and that’s frustrating.

For problems relating to tax, 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! 

So why only one in ten? <I found out>

Top three reasons businesses didn't seek guidance from their accountants (on non-accounting issues):

1. I didn't know my accountant could help me in this way - I only meet them a few times a year
2. My accountant didn't ask me anything about my business beyond my taxes and paperwork.
3. My accountant doesn't know anything about tech and funding right? They’re only my accountant. <somewhere in the world a kitten dies every time a business owner says this>

I read the reasons above in a different way:

1. Lack of proactive guidance and help from my accountant
2. Lack of interest shown by the accountant in my business. They only care about taxes and accounts and not anything beyond accounting.
3. Lack of awareness around the services my accountant offers and how they can help me. They don't have a website/don’t display all their services on their site. They only communicate with me once a quarter or when there is a problem with HMRC.

Why is this a problem?

Quite simply, our clients are facing issues which we as finance professionals in 2017 can help solve.

Business challenges over the long term can impact us too. If we’re worried about clients squeezing fees every year, the lack of support from us and the perception this carries (in the eyes of our clients) will not help us avoid these awkward conversations around fees.

Churn (clients leaving after one or two years) 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'sCheapAsChipsTaxApp.com (not real...yet) for twenty quid 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) and the use of technology to genuinely help their business (from people counters on the doors of our restaurant owners to building a Yelp/Facebook for business presence which drives footfall to the restaurant).

What can we do as accountants or bookkeepers?

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 three clients you completed work for. List all the jobs you carried out, eg 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 break down these services when you presented your invoice or engagement letter so your client knew all the awesome services they were receiving?
• Could you have supported your clients in any other way? Did your client know you can provide other services? Did you ask your clients their aspirations over the next six to 12 months? Will they need help with any other aspect of their business (non-accounting) which you can help with?

Review your perception and brand

• Get a friend or family member to review your website and/or office. Ask them what they think you offer small businesses. Does this perception of the type of firm you are match your own?
• Now look at some other accounting firms’ websites. What type of client do you think are attracted to these other firms? 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 third-party apps) and some can provide tech reviews for their clients. What if your client faced more complex tech challenges? Be open to outsourcing more complex queries to third-party tech consultants. My family's firm and Propel by Deloitte both work closely with tech agencies and digital marketing agencies, and have referred this agency to help clients build their websites, design logos or build visual assets for marketing. Our platform expands beyond apps and tech and it benefits 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 or you simply can’t be bothered to learn, outsource and build a network.

Skills in-house vs outsourcing

• If you're providing services beyond compliance work you need to upskill your team. It's not difficult to provide services such as forecasting, debtor management and in some cases, investor/VC 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, It’s not difficult to do.
• 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?

If you’re in practice today and you’re not providing services beyond bread and butter accounting, then think about upskilling yourself/team or team up with service providers who can help your clients.

How do you help your clients beyond accounting and tax, and how do you ensure your future and existing clients know about these other services you can provide? Share your thoughts and tips below.