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Accountants are well placed to support business owners overwhelmed by the cost-of-living crisis, according to a data analyst.
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Accountants primed to help burnt out business owners
27 May 2024
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Ahead of the ACE24 Accounting Conference and Expo 2024, head of data analytics and content at The Benchmarking Group, Julia Thomson, said the current economic environment is deeply impacting small business owners in Australia.
The Big Small Business Survey 2023 of 341 business owners from Australia and around the world revealed that a quarter cited cash flow issues as one of the challenges they faced, while a third struggled with understanding the best way to grow their business.
“With cash flow, cost of living, rising wages, and reduction in consumer sentiment all impacting small business on some level, this cohort is primed for burnout,” Thomson told Accountants Daily.
“We may see a large number of businesses exit.”
Thomson said accountants could help overwhelmed business owners, who form a large segment of their client base.
“One of the recent reports by The Benchmarking Group revealed that high profit firms are focused on value-adding and servicing fewer clients per partner than their lower profit counterparts,” Thomson said.
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“We also know that business owners are demanding more from their accountants so there will be an opportunity here for firms to grow their value per client.”
The Accounting and Bookkeeping Insights State of the Industry Report released by Xero in 2023 stated that more practices reported billing using value-based pricing because of both the commercial and client benefits it brings.
The survey of 728 accountants and bookkeepers in practice across the US found that just over 60 per cent have at least a quarter of their client base on a value-based pricing model.
Respondents who have adopted value-based pricing reported doing so because it is easier for clients to understand (43 per cent), it is more profitable (38 per cent), it has helped increase revenue (37 per cent), and it feels more honest (36 per cent).
At the ACE24 Accounting Conference and Expo 2024, Thomson will present a session on the major trends shaping the accounting landscape and the traditional accounting role. These include evolving customer demands, regulatory shifts, technological advancements, and increased employee influence.
She will also explore challenges like the shortage of accountants due to the large number of accountants approaching retirement and fewer students studying accounting, as well as why this is occurring and what accounting firms could do to minimise the threat and gain an advantage over competitors.
Thomson recently penned a piece for Accountants Daily about the major findings after The Benchmarking Group analysed data and trends for 2024 in its Crunch Report.
She highlighted that the accounting shortage would continue, which would pose challenges for firms looking to recruit and retain talent.
Indeed, NAB's Accounting and Financial Planning Report 2024 found that seven out of 10 Australian accounting firms identified staff hiring and retention as their top challenge.
Meanwhile, 50,000 accountants are forecast to retire in Australia in the next 15 years, according to the Review of the Future of the Migration System 2022 by CA ANZ and CPA Australia. On top of this, one in three accountants are considering leaving the industry in the next five years.
To hear more from Julia Thomson about how accounting firms could position themselves to gain a competitive edge in an evolving landscape, come along to the ACE24 Accounting Conference and Expo 2024.
It will be held on Thursday, 20 June at Hyatt Regency, Sydney.
Click here to buy tickets and don’t miss out!
For more information, including agenda and speakers, click here.
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