Before the onslaught of tax season begins in earnest, accountants should think not only about how they’re going to survive their busiest time of year, but also about generating a perennial revenue stream beyond this tax season.
A recent survey of 301 managing partners of small accounting firms (firms with five or fewer equity partners and a maximum of $10 million in annual revenues) found that seven out of ten managing partners expect it will be more difficult for their firms to make money in 2016 than it was in 2015. However, opportunities to make money may not be so difficult to come by.
While taking on additional clients is a viable option to increase revenue, a better option is to offer additional services to existing clients. Most accountants don’t know what additional services to offer, and many think they don’t have the time to handle additional services. These accountants should be thinking critically about streamlining their internal processes to accommodate a larger volume of work, because significant opportunities for offering additional services to their existing clients do exist.
A new survey by AccountantsWorld found that 25 percent of the small business owners surveyed said they’d be at least “somewhat interested” in transferring more of their accounting work to their accountants. So, with one out of every four small business owners open to an expanded relationship with their accountants, there is no better time for firms to be reaching out to current or prospective clients to expand their slate of services before the tax season crush.
The survey also found that when a small business employs an internal bookkeeper, interest in outsourcing accounting work increases to 45 percent. In addition, the survey found that the bigger the company, the more likely they are to be interested in outsourcing more of their accounting work.
By encouraging existing clients to expand the services they use, firms can easily create more revenue streams for their practices with minimal lift. Firms should also consider adding payroll services for existing clients.
Since payroll is so highly intertwined with clients’ overall expenses and tax liabilities, it is a natural fit for accountants to also manage this function for their clients. If you haven’t considered offering payroll services because of the perceived notion that payroll is an “all pain, no gain” service, consider that thousands of accountants have turned payroll into a virtually painless, highly profitable service using professional, robust cloud-based payroll systems created exclusively for accountants.
Knowing that additional ways of raising the bottom line exist, the next step is to find the resources needed to add those services. The trick for accountants to offer additional services without adding any staff is to focus on streamlining. By reducing the time spent on existing services and finding ways to provide additional services with minimal time and effort, adding services without adding staff becomes possible. The right professional cloud solutions can help you accomplish both.
It is widely-recognized that the primary source of wasted time in accounting is dealing with the errors clients make. Using a professional accounting system that lets accountants work collaboratively with their clients and gives them the ability to customize the system for each client, and that gives clients access only to the functions they can perform, enables accountants to drastically reduce client errors and regain significant time.
Professional accounting systems also make it much faster and easier to produce customizable financial statements, and accountants can take advantage of time-saving features, such as bank feeds that reduce the data entry time needed for the write-up work they perform for clients who write manual checks - time they can use to offer complete accounting services and payroll services.
Cloud-based professional accounting systems can also help accountants offer payroll and complete accounting services faster and easier by making it possible for accountants’ staff to do what clients’ staff or their external bookkeepers currently do – only faster, easier and more accurately and without leaving the office. Cloud-based payroll solutions created exclusively for accountants have also introduced a high level of automation in payroll processing, allowing accountants to offer highly profitable payroll services with minimal staff time.
These systems make it possible for accountants to generate significant additional revenues by offering payroll and complete accounting services without adding any stress to their staff. In fact, streamlining work flow and eliminating redundancies and unnecessary work actually increases staff satisfaction.
As a bonus, cloud-based professional accounting solutions include analytical tools to monitor client key performance indicators (KPIs) and cash flow with minimal effort. These value-added services provide additional sources of increased profits while strengthening client relationships.
Your clients are looking for you to offer them the additional services they need - services that you can easily offer. What are you waiting for?
About Dr. Chandra Bhansali
Dr. Chandra Bhansali is CEO and co-founder of AccountantsWorld, whose cloud-based solutions for professional accounting and payroll help accountants boost their profits without adding staff.