The present landscape for accountants and bookkeepers is full of opportunity, but it’s also full of challenges — especially for practices that aren’t willing to evolve their offering.
Happily, adapting to thrive in 2019 and beyond doesn’t have to require wholesale changes to how you work with clients. Upgrading to app advisory means making a few key tweaks to your offering so that it’s tailored to your clients’ needs and goals.
Read on for an introduction to all-things app advisory. Including:
What is app advisory?
App advisory is a service that involves recommending cloud solutions to clients. Cloud technology can revolutionise how businesses operate — but with 1000s of tools to choose from, many companies need help getting started. App advisory provides that help.
Accountants and bookkeepers are best placed to take this vital role in the new landscape of SaaS-based cloud tools. You know more about your clients than any app provider does, and you know more about the cloud than your clients do.
As well as giving businesses a boost, consulting on apps brings significant benefits to your practice. But before we take a look at how accountants can achieve success with advisory, let’s examine the known challenges facing the industry.
Among numerous minor issues, three challenges stand out.
Three challenges for accountants today
1. Automation
Back in 2015, a survey by PricewaterhouseCoopers (PwC) predicted that the accounting and bookkeeping industry would face more upheaval from automation than any other: with 97.5% of workers impacted at some point in the next ten years.
That prediction is playing out, with the majority of workers probably already affected by automation in the form of cloud accounting platforms such as Xero or QBO. These apps are already easy-to-use and affordable — and only getting more so. The challenge this brings to practices is twofold:
- DIY accounting is easier than ever, and getting easier. Learning the basics of bookkeeping on YouTube and setting out on your own using Xero is now a viable option, especially for SMEs
- Switching accountant is simple. Instead of organising the transfer of physical accounts in form of hard drives or paper, businesses only need to give their new accountant access to their cloud system
2. Clients 2.0
Not only are SMEs more willing and able to leave their existing accountant — or never work with one in the first place — but those who still rely on accountancy practices expect a different type of service than just a few years ago. With compliance work dwindling, clients are instead looking to their accountant for their business expertise.
In some ways, nothing has changed. Businesses have long turned to accountancy firms to save them time so they can focus on their core business such as growing sales, spending time with customers and diversifying their products. But while previously accountants could fulfil this function by taking care of the compliance work, today they need to find new ways to help their clients save time.
3. Changer danger
A recent survey by Accountex Network found that 85% of SMEs want strategic advice from their accountants. For an industry that’s finding attracting and keeping hold of clients increasingly tricky, that’s a compelling statistic. But the same survey reported that only 24% of those SMEs actually get advice from their accountant or bookkeeper.
There are two reasons for this shortfall. Firstly, ‘Strategic advice’, is a broad term. Clients might want you to help them adapt their processes so they can scale, sell into new markets, help eliminating stockouts or more. The list is potentially endless.
Secondly, moving to ‘full-service advisory’ is a daunting prospect that can involve adding considerable expertise. Implementing and supporting solutions, for instance, often requires hiring or retraining staff. That investment of time and money is beyond many smaller practices.
What are the benefits of app advisory?
The single biggest benefit of app advisory is that it enables you to address the three major challenges faced by accountants today:
Automation
SMEs still need advice on where automation can benefit their business, and how to find the right solutions. Offering that information makes your practice indispensable, greatly reducing the risk of losing clients to self-service or another practice.
Clients 2.0
Apps for inventory management, accounting, POS and more are designed to save time that could be spent on value adding activities. By recommending these solutions, you’re delivering the exact service that SMEs demand today.
Changer danger
Consulting on cloud apps is a great first step towards demonstrating that your practice can offer value beyond compliance. It doesn’t require significant retraining or hiring, and there are lots of resources to help get you started.
However, there are lots of other reasons to get started, including major improvements you can make to both your practice and the businesses you work with.
Benefits for you
As well as futureproofing your practice to thrive for the foreseeable future, consulting on the cloud should bring several immediate improvements to your day-to-day operation.
Grow revenue
There are lots of ways to grow revenue by recommending apps: more billable hours, a one-off consultation fee or quoting based on the value you’ll deliver.
Deepen client relationships
Delivering cloud advice means getting to know your clients’ businesses much better, strengthening your relationship with them across the board.
Save time
Cloud applications don’t only save your clients’ time — they remove the messy data that can clog up your day, too.
Benefits for your client
Cloud technology enables businesses to spend more time on core functions by automating or eliminating tasks that don’t add value. But they also bring several other direct benefits:
Save
For many businesses, a cloud suite costs less than their legacy system — and enables them to grow without spending more on new staff.
Scale
Give your clients technology that matches their needs today, and years down the line. Apps can be used to easily scale up operations.
Grow
Seizing new opportunities — for example, by adding new online sales channels — is easy with sophisticated tech powering their business.
According to Xero, practices that advise on apps grow revenue 60% faster — and SMEs that use them grow 30% faster.*
How to set up your practice for app advisory
Making the move to app advisory can be easily achieved in three steps. Firstly, you’ll need to decide the level of service you want to provide. Then you can identify some solutions to work with and reach out to them. And finally, pick a pricing model.
1.Choose a service level
2.Build your stack
3.Pick a pricing model
Here’s a quick outline of each one. For a detailed guide, download your free upgrading to app advisory eBook.
1. Referring vs implementing
There are two broad levels of service you can deliver as a cloud consultant: referring or implementing. Referrers recommend apps that could benefit their clients, then take a step back. Implementers take a more hands-on approach, helping with setup and offering ongoing support.
We’d recommend that most practices stick to referring — it brings all of the benefits of implementing, but without the setup headache.
2. Building a stack
There are 1000s of apps out there, so most advisors select a few to work with: their ‘stack’. Picking who to work with include involves deciding which industries you are most familiar with, doing some research and then reaching out to your chosen solutions.
Most app providers will have partnership programmes, ensuring that you get all the support you need.
3. Pricing models
How do you want to charge for your new service? When you’re just starting out, adding extra billable hours is usually sufficient. But as you build out your offering, you might want to consider other options.
Once your practice is set up and ready to go, it’ll be time to help out your first client. For a step-by-step guide to this process — as well as more detail on what’s covered above — take a look at our free upgrading to app advisory eBook.
*Xero Small Business Market Study UK, July 16
Article by Patrick Foot in collaboration with our team of inventory specialists. When he’s not writing about inventory management, he’s busy jet-setting across the globe.