Is This the Revenue Stream Most Accountants are Missing Out On?

ZOHO survey
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We often hear that accountants and bookkeepers are increasingly involved with the specification and implementation of technology for their clients.  There's no news there, but what interested us was how much of an opportunity this might represent and how well it's currently being exploited.

We teamed up with ZOHO and surveyed 335 firms, and the results may give you cause to raise an eyebrow. First, let's take a look at the top results.

We found 83 percent of respondents reported that they were asked to tackle some kind of technology query in the past 12 months, and 94 percent of those reported that they were proactive in providing advice when they spotted a need (AccountingWEB's readers tend to be more proactive and technology friendly than average, but that's still a surprisingly high number).

Not surprisingly, most of the technology questions related to software selection and implementation, but while 68 percent of respondents reported that most queries originated from cloud software and add-ons,  79 percent pointed to desktop software.  Training and data security questions also showed up as important areas where clients needed support. So if most of your clients are still using desktop-based software, there's probably still a demand for your support here.

In terms of scale, 36 percent of respondents reported that they only receive one or two queries per month, but 41 percent suggested they receive between three and ten (12 percent reported more than 11). Such figures suggest there's a strong demand for this kind of advice.

This leads us to the more interesting question: How effectively are firms converting this demand into revenue?

Our evidence suggests that over a third of firms don't charge at all for technology advice, with the remaining 64 percent adopting hourly, fixed fee or value pricing options (although it's unclear how effectively a fixed fee structure can accommodate work of this nature). Only 4 percent suggested that they charge specifically for the project.

Perhaps more revealing is that when you just look at those who do claim to charge, nearly half reported that they generate less than 5 percent of their revenue from doing so. Encouragingly, 10 percent of firms suggested that up to 25 percent of their revenue originates from technology advice services! 

So we seem have a picture of clear and broad demand for technology advice, but only a few firms being successful in transforming that into a significant revenue stream. 

Why? When we asked what the biggest concerns were about advising clients on tech choices, the results were clear. Liability issues, lack of confidence and worries about being sucked into complex projects that drag on were by far the biggest blockers. 

In summary, the message to those who are interested in expanding their firms into formally offering this kind of advice is that YES: It can be done. Your clients probably need it, and if you can find the right technology partners to give you the confidence, this could be a great direction in which to take your practice.

About Andy North

Andy North

Andy has been part of AccountingWEB since 2001 - initially running the UK operation until he moved to the US in 2015 to take over AccountingWEB.com.  

Currently residing in Boston, Massachusetts, Andy takes an active interest in how the accounting practice world is changing and evolving on both sides of the Atlantic, and regularly consults with vendors to help them build engagement with the profession.

 

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