Considering the recent survey of 355 small to mid-tier accounting and financial services practices, David Clatworthy, division director for Macquarie Wealth Management, said firms in both markets are evolving to meet changing regulatory and client expectations, leading to strong profits and low client turnover.
“Customer satisfaction, new technologies and the retention of key staff are critical for driving profitability,” Mr Clatworthy said.
“An overwhelming 91 per cent of firms said greater client referrals and improved income per client were the main revenue drivers for their business, while 79 per cent of high profit firms said adding value to existing customers is the most effective strategy to improve profitability.”
Looking to the future, confidence remains high among accounting and financial services firms, with 83 per cent reporting they are positive about their business's prospects.
“Over the next 12 months, all businesses say they will focus on attracting new, ideal clients. While smaller firms are focused on regulatory changes and are three times more likely to feel impacted by changes in this space, 41 per cent of larger firms say integrating technology is a key challenge and will look to better use it to boost efficiency and attract and retain staff,” Mr Clatworthy said.
“Successful accounting and financial services firms are seeing the opportunity in an evolving market, clearly defining their value proposition to clients and adjusting their business model accordingly."
According to Mr Clatworthy, the lines of segmentation between financial services and accounting firms are shifting, increasing the need for principals and partners to look at what is driving value for their business.
“We’re seeing a variation on how firms believe they can best service clients and drive revenue from adjacent services. For some, this means looking to business models that embrace a more holistic advice offering, while others are choosing to specialise in order to set themselves apart,” Mr Clatworthy said.
“A long-term focus means many firms are embracing a multidisciplinary business model, and adding new services to increase their ability to provide better value to their clients," he added.
“Investing in quality staff is also essential to building a stronger client value proposition and relationship, with almost half of respondents [44 per cent] saying the retention of quality key staff is an important strategy for driving profitability.”
The not-to-be-missed Accountants Daily Strategy Day will travel through Melbourne and Sydney in August to equip accounting professionals with the latest industry updates and tips for modern practice management as well as the latest cutting-edge technology, processes, strategies and trends shaping the future of accounting. Visit the website for more information: www.accountantsdaily.com.au/strategy-day