Where would you be without compliance?
Imagine for one moment that you are listening to the Government’s budget plans and the Chancellor announces that, to minimise Red Tape, there will no longer be a requirement for businesses or individuals to file accounts or tax returns! A new system is being introduced that is fully automated and completely remove any filing via a third party.
Compliance is the number one reason why people use an accountant. There is a fair chance therefore that this scenario would remove the core of your business, most of your fees and the main reason why people buy your services.
What would you do?
Of course, it may be that you have to shut your doors as your income gradually dries up.
But what about all the valuable client relationships that you currently have?
What about the non-compliance advice that you give?
There is an interesting exercise to do around your firm’s dependence on compliance, what else you do (or can do) and how you can build non-compliance-based services in your firm.
To be clear, I don’t believe the ‘compliance is dead’ argument, there is more compliance around than ever, but there are two very sound reasons for exploring this idea of ‘what can we do that isn’t compliance based?’
- Competition around compliance will grow and grow, as will the noise for clients to become more self-sufficient. Accountants can counteract this through education and greater efficiencies but it is going to be an increasingly challenging sector.
- Compliance is driven by government and so subject to rapid changes of direction and external factors that the accountant can little influence or control. That is a commercial risk. My scenario may be a little extreme but it hardly lies in the realms of impossibility.
Moving our firms onto a wider playing field makes sound commercial sense, and now is a good time to explore it.
Our biggest asset right now is a loyal and trusting client base. That’s a great place to start when looking to grow existing offerings and develop new ones.
As accountants, we already provide business support services to clients. These may be driven by compliance, such as payroll, bookkeeping etc but help fulfil practical as well as legal requirements.
In addition, we advise clients all day long. We may not do it in a structured and commercial manner but it’s still a service we provide.
Accountants tend to have good business networks around them, people and businesses who can help them to meet the wider client needs.
And, of course, there are the client businesses themselves, a wealth of collaborative opportunities open to the accountant.
My question is this: What steps could you take to shield your firm against the risk of your compliance business disappearing?
- Which of your existing services could be restructured into a more commercial form?
- What new services could you offer?
- What steps could you take to commercialise relationships within your business network?
- What collaborative opportunities exist within your client base?
There seems to be an assumption that accounting firms cannot exist without compliance. Without preparation I tend to agree but, with some thought and planning, building on your existing services and your available assets can take your firm in a different direction, offering a much wider spectrum of services to the market and more income streams for your firm.
Compliance work provides accountants with a great base for building trust with their clients. With that trust in place, the opportunities are limitless if we change our existing pricing strategies (stop giving it away for free!) and think more creatively about the relationships around us.
Good luck!
