A recent article on Accounting Web hailed the end of the mid size accountancy practice with fee income of £500,000 through to £3m. An utterly depressing article seemingly suggesting that the number of SMEs was in decline due to the costs of setting up any business.
Read the full article – click here
Luckily we and many others, such as Lord Young do not share this view; in fact Lord Young’s report “Growing Your Business” proclaimed that record numbers of people are starting a business each year.
So why should the number of midsized accountancy firms need to decrease if there is an upsurge in UK businesses; quite baffling.
Times are changing
The world is changing and all businesses, including accountancy practices, need to change as well. We’ve seen enough evidence of failing business models that did not take note of their changing environment and adapt; Jessops and Blockbusters amongst the big name failures in recent times.
Merge isn’t the only answer
When the going gets tough accountancy firms jump to merge but this brings along a whole host of problems such as culture, power, duplication and so on.
Adapt, change and grow
Of course the real answer is to adapt, change and grow in line with the business world around you. Nothing ever stands still and those that rest on their laurels of having a successful & profitable business always come unstuck in the medium to long term as new entrants and competitors overtake them.
Lessons for Accountancy Practices
Anyone with even half an eye open to the changing world of accountancy practices would realise that the traditional high street model of “the brown paper bag” yearend work accompanied with high accountancy fees will be all but extinct in a few years time. In fact for many that model already is dead.
Businesses are becoming savvier about finances and what constitutes good value for money on their accountant’s bill. Much of the accountancy work is done in house by finance teams or bookkeepers. Traditional accountancy systems such as Sage are being replaced by more efficient and current Cloud Accountancy system giving access to real time company finance data. All of this means that the SME business owner is demanding serious fee reductions and / or a more proactive and responsive accountancy service delivered at the point of need otherwise they are voting with their feet and taking their business elsewhere.
But rather than moan about the fee reduction or jump into panic merger talks, accountancy practices should look to the future and how their business can shape up to tackle the new world.
O’Neill Strain Smith doing this
One such firm doing just that is O’Neill Strain Smith based in Omagh, Northern Ireland. They have joined CheapAccounting.co.uk as a franchisee. Tommy Strain who heads up the practice explained:
“We knew the world was changing, we’ve seen it in our fees. The business world in Northern Ireland was hit hard by the recession and that has hurt us and I’m sure, many other accountancy firms. I could see this Cloud world on the horizon but I just didn’t know anything about it, where to start or how to adapt our traditional high street practice to operate in the cloud. Joining CheapAccounting.co.uk seems like such an obvious thing to do; we all get to learn about the new world of practicing in the Cloud under those that have done it before. There is no need to re-invent the wheel and make mistakes along the way. The Cloud world doesn’t seem quite as scary when someone is holding your hand along the way.”
Elaine Clark, Managing Director of CheapAccounting.co.uk says:
“Tommy and his team will be a great addition to our CheapAccounting.co.uk franchise team and prove that franchising is not just for start up practices. O’Neill Strain Smith join at a very exciting time with the launch of our Accountant Business School giving much more focus on how to practice in the cloud. The future doesn’t have to be bleak for accountants just as long as they have their head in the clouds.”