When I first started at Spotlight Reporting as a Sales Development Representative, my primary responsibility was to contact people trialling our software. I would engage with them, discuss their requirements and objectives, and from there connect them with the people and resources they needed to succeed.
Very early on, I noticed that there were two distinct patterns among our trialists. Occasionally, I would come across the ideal boutique advisory firm: an accountant who had just opened their own practice and had 20-30 clients all on fixed-rate monthly packages that included a report, a forecast, and an advisory meeting. These accountants typically had a high average revenue per client, far fewer headaches, and a deep understanding of their clients and their clients’ businesses.
Conversely, I would also meet with senior accountants or directors from well-established firms, who tell me they’ve been approached by one of their clients with a request for some reports, maybe a forecast. After further discussion, it usually becomes clear that these accountants want to provide more advisory services, but don’t see any potential in their current client base that would justify anything more than ad-hoc sessions. Yet unlike the small boutiques, these firms would have around 200 clients.
I began wondering why there was such a stark difference between the two, and if the latter were actually correct in their analysis of their client base. To supplement my own observations, I turned to the available research.
In 2018, NAB released their “Key Insights Into the Australian Accounting Industry” report, exploring the perspectives of SMEs and their accountants in the context of accounting services. In many areas, there was a large disconnect between what SMEs wanted, and what their accountants thought they wanted. For example, while 17% of SMEs wanted business analytics, only 10% of accountants identified that this was the case. Even more startling, while 21% of SMEs rated business strategy services as being of high importance, only 9% of accountants did.
These findings supported what I’d concluded myself: accountants underestimate the scope for advisory services amongst their own clients.
A succinct way of thinking about it is with the ever-popular iceberg analogy: if one or two of your clients proactively approach you for advisory services, you may conclude they’re the only ones who want them. But in reality, 21% of your clients want business strategy, 17% want business analytics, 10% want budgeting and forecasting, 12% want business planning etc. They’ve just never asked you for it.
In short: what you see is just the tip of the iceberg.
If this sounds intriguing, there’s a lot you can do as an accountant to tap into the demands of the market:
1. If one or two of your clients approach you requesting business advisory services, make it a priority to deliver. Business advisory services are highly valuable, and if your advisory clients are getting the services they need, they’ll recommend you to other business owners. People love being the one to give a good referral, but they won’t stake their reputation on someone they aren’t completely satisfied with.
2. Be proactive. Those one or two clients are just the tip of the iceberg, and there’s a lot more potential under the surface. Ask your clients for feedback frequently, and give them the chance to tell you what they want.
3. Market your advisory services to your current clientele. The best way to do this is to give them value upfront for free. You can use a Spotlight Reporting trial to create free management reports for each one of your clients, with very little time and effort. We’ve seen firms have amazing uptake from this tactic.
If you’d like to read the full Key Insights Into the Australian Accounting Industry report, visit business.nab.com.au