1. So, what are the key priorities for accountancy firms?
2. How accountancy firms are strengthening their existing client relationships
3. How accountancy firms are creating cost savings
4. How accountancy firms are driving growth via new clients
5. How to improve client service
The events of the past few years have caused accountancy firms to fast-forward changes to their working practices quicker than ever before.
On the whole, remote working has been largely successful. But can accountants keep
it up?
Few amongst us will disagree it will be difficult. Businesses in the UK are in for a rough ride, and will be leaning on their accountants heavily in the upcoming months as they navigate potentially tough trading times. The ripple effect will be felt by accountancy firms.
We wanted to know how the accounting profession plans to chart these waters – by either pursuing new revenue streams, cutting their costs, or focusing their efforts on maintaining their client status quo.
These are the results of our survey of 250 senior decision makers from UK accountancy firms. The principal message received was that improving client service is high on the agenda.
But firms are also keen to explore new ways to grow their client base and protect their bottom line through cutting costs. This is understandable in the wake of the past 12 months’ circumstances.
We hope this report sheds light on the profession’s focus in the upcoming year, and provides you with insight into how you can approach this next year’s challenges.
Strengthening relationships with existing clients is the main priority for most firms.
Not surprising given the circumstances. Covid-19 has disrupted even the most stable business.
Accounting firms are not immune to this as they grapple with their clients’ businesses failing, cost cutting, reduced team sizes and tech adoption.
Predictably, cutting costs is the second highest priority as firms look to streamline overheads and protect their bottom line in the face of potentially reduced client fees.
Driving growth is still a high priority for a quarter of firms but this likely would have been significantly higher, had we not suffered a global pandemic and the worst economic upset in 100 years.
Whatever the priority, this is a tough time for accounting firms and as ever, the best, most nimble, forward thinking firms will triumph.
When we looked at our survey results, the most notable variation in the key priorities data came from the larger cohort of firms.
Those with 500+ employees were almost twice as likely to list strengthening relations with existing clients compared to a smaller firm.
It is also interesting to note that cost cutting and driving new clients were both below 10% too.
We talked to Jennie Sanders, Head of Marketing at UK 200 firm, Dains Accountants, to understand why:
“At the beginning of the pandemic in particular, our focus was very much on strengthening relationships with existing clients.
“Businesses were facing the unknown and needed more support than ever.
“With every new announcement, it’s our responsibility to ensure clients can access all the information they require in a timely manner and then continue to support them by keeping an open dialogue.”
We helped our clients decipher government guidance – and take onboard what they need to and not get bogged down in the detail.
The firms most focused on strengthening client relationships are in the northern regions, Scotland and Wales.
Although firms in Yorkshire and the Humber are more focused on growing via new clients (35%).
Wales and the North East are also keen to grow their client base (35% and 37% respectively) more than any other regions.
The further south the region, the more likely an accountancy firm is prioritising cutting costs in the organisation.
However, strengthening client relationships still featured highly in the survey results.
2020 was a year of reaction. It was remarkable to see just how quickly firms adapted to the lockdowns.
They were the catalyst for action on: flexible working, improved communication links, and updated technology – most of which will have been mulled over in the years prior.
It also highlighted the need for formal strategic business continuity planning. Something which the majority of practices are now regularly undertaking.
With the right plan in place, there’s no reason why these benefits and improvements don’t become permanent features.
Here are a few key points to include in your practice’s business continuity and remote working plan you may not have thought about:
During lockdown, we learned who our friends are. With so much time pressure on accountants to support their clients, having sympathetic suppliers often eased this. Strong relations will help encourage patience when you need it most. Take an honest look at the state of your supplier relationships and make improvements where necessary.
Data access and communication channels are a constant need, and prone to updates and fixing. Times were tense enough when a system failed in the office. This stress is dialled up when working remotely. A twice-yearly assessment of your current data access and communications systems could save a lot of pressure and time when things don’t work properly.
It is all too easy to stick to the systems we’re used to. Especially when dealing with a large workforce. But keeping abreast of developing technology – and being open to trying new software and systems – could save your firm a lot of time and money in the future. Particularly as leading software is becoming evermore client-friendly. Be ahead of the curve. Your business continuity plan should include as many up-to-date software options as possible. You might well need them.
Industry sectors have been hit by sheer bad luck. Few anticipated this happening to hospitality, events, retail etc. but 2020 has exposed the dangers. Taking stock of the industries your client-base covers could hold you in good stead, particularly if you find you have an excessive amount of clients in one particular shaky sector on the books.
Firms that run monthly service plans for clients, and have fees paid monthly by direct debit, saw much less cash flow downturn than those dependent on ad hoc billing. We also saw, once more, the value of money in the bank. It would be wise to add into your business continuity strategy a plan to increase your minimum cash reserves, and accelerate moves to monthly direct debit.
How accountancy firms are cutting costs, split by region:
According to our survey results, the further south the region, the more likely an accountancy firm is prioritising cutting costs in the organisation. However, strengthening client relationships still featured highly in the survey results.
Just under a third of accountancy firms surveyed said cutting costs to the business was the primary focus of the next year. We explored exactly how they plan to achieve this.
Why outsource?
It’s a question many practices eventually come to ask. Accountancy firms, like many businesses, start off doing everything themselves.
But being a jack-of-all-trades only gets you so far, and there comes a point when it makes more business-sense to employ specialists in their field.
A first port-of-call might be to hire directly into the practice, usually covering more jobs than one. But as you grow, you’ll want someone who is 100% focused on the area in question.
Take marketing as an example. It’s unlikely you want to hire a copywriter, graphic designer, marketer and a search engine optimisation specialist.
The beauty of outsourcing your marketing is you get access to a whole range of different skills for the price of one-two permanent staff.
For example at PracticeWeb we have over 20 staff from marketers, editors, search engine specialists to designers.
Even if you employ a marketer, they won’t have the range of skills and ability an agency has. Not to mention the time it frees up to outsource to a company.
Who’s been there, done that and wears the scars to help you short cut mistakes and get straight to growth. This is the point when outsourcing becomes the better option.
The principal benefit of outsourcing means you get access to a whole range of different skills, paying only for the services you use.
It can also give you a level of quality you may otherwise miss. Talking to outside experts is a good way to diagnose problems unnoticed by you.
In short, it allows you to tailor your service to suit your needs, while you and your staff focus on the core business.
You pay for what you need. If you need more support, you can work with your outsourced partner as necessary, giving you a staffing flexibility and economy of scale that doesn’t exist with in-house employees.
A quarter of accountancy firms are planning to grow their practices via new client revenue over the next year.
As we can see from the above chart which covers all of our survey respondents, promotion methods are fairly evenly split. Three routes in particular account for over 60% of new client acquisition activity
But when we look at this by size of firm the picture changes somewhat:
500+ firms are far less likely to use social and PR to drive awareness at 13% vs. 21% for 50-250 employee and 251-499 employee firms.
The larger firms (500+ employees) are less keen on spending more on marketing budgets and increasing activity to grow the firm at 10% vs. 19% 50-250 employee and 25% for 251-499 employee firms, focusing instead on increasing sales/BD activity and offering incentives and offers.
This past year has forced many businesses to manage massive volatility in new business demand. Practices can be divided into three types: Thriving, Surviving and Diving. Marketing teams in each business type need to act according to the underlying demand curve. Thriving practices should keep up with demand.
Their marketing needs to be downweighted if it’s producing too many leads for the firm to handle properly, or upweighted if the business can keep pace with the upward trend. They have the luxury of this flexibility. For the Diving firms, it’s important that managing current client needs are prioritised – for instance, bookkeeping and taxes.
For these practices, it might be possible to pivot towards groups of clients still spending with increased short term activity.
What’s important here is correctly identifying the natural demand for your services, and any pockets of new interest from different client groups. Google search interest is an incredibly useful yardstick for many categories, as is gathering insights from your accountants.
This exercise should enable your quick pivoting towards growing demand groups, and cutting spend to clients and businesses that aren’t spending at the moment.
Whichever category your practice falls into – Thriving, Surviving, Diving – it’s important that you lean into your brand.
Emma Harris, from the branding agency Glow London, says: “Your brand proposition should be built around the positives you uniquely bring to the client. In times of crisis, this should be amplified, not forgotten. Stay focused on who you are. Don’t try to be something you’re not. It will fail.”
Within that ‘brand wrapper’ it’s OK to change your services to target clients as their needs change. So as long as they’re delivering the unique value that only your brand – and practice – can bring.
For practices using inbound marketing techniques, it’s especially important to convert website visitors to leads – and subsequently clients – when demand drops. Here’s a few ways we’ve found to increase leads quickly:
56% of businesses hail the telephone as the most important channel in which to communicate with clients.
45% of those phone calls are a new enquiry, and this is increasing as people do more research online, and are primed to make a final business decision when they actually call a practice.
Calls convert at 10x the rate of website clicks and are typically much more valuable conversions.
Displaying your phone number clearly on your website and encouraging people to call you directly for a consultation or quote drives more calls.
This can be set up in hours and can double lead volumes on a typical website.
This is due to visitors asking questions, without being ready to commit to a call or a web form.
Live chat allows them to ask questions to see if the service is right. It’s also beneficial for firms with global clients, as a managed live chat service is available 24/7.
It’s important to the success of lead generation and inbound marketing that website tracking is put in place, tracking channels all the way through to visitors, leads and clients.
At Moneypenny we use Ruler Analytics as our tracking and attribution partner as they are able to track both calls – through dynamic phone numbers on the website – and live chat leads.
From our survey results, it appears that accountancy firms are very much plugged-in to their own marketing needs.
The majority (60%) of firms employ either a dedicated marketing manager/director or team. Just over a third either outsource the activity or divide it with another role in the business.
The largest firms are more likely to employ a dedicated manager/ director, with 33% of firms with over 500 employees holding that role.
Mid-sized firms are more likely to lean on outsourced marketing businesses to fulfil their requirements with 37% of 250-500 employees opting for outside assistance.
Our results show that smaller firms (100-249 employees) are the most likely to share their marketing jobs between other roles in the business.
How this compares with law firms
Whether a practice is aggressively growing, or keeping its own pace; marketing matters. We were interested to see how accountants’ marketing teams compare with the legal profession.
In business, a website is the equivalent of the shop window, and the listing in the Yellow Pages.
It’s safe to say most people start their consumer journey on the internet, so how easy a firm is to find and how navigable its website is crucial to winning visitors over.
As with marketing, it seems accountancy firms have their finger on the pulse – a huge 70% of firms say their website is important, with 30% of this figure saying that it is very much so.
However, a surprising 29% said their website was either not very important, or not important at all.
Once again, the largest firms surveyed placed the most importance on their websites – 80% of firms with over 500 employees.
Interestingly, a handful of our smallest firms – 50-249 employees – didn’t have a website at all.
Your firm’s website is an important asset. After all, it’s the first experience many of your clients and prospects have of your firm.
– Xero
Client service can so often be pushed onto the back burner when it comes to everyday work. The tasks-in-hand can take over making sure clients themselves are happy.
This could be argued as the correct way of working – fee earners and accountants need to concentrate on their specific skilled jobs, not worrying about their clients emotions.
It’s a good reason to have people in place to do the client service heavy-lifting e.g. client support teams.
We wanted to know how accountancy firms handle the ‘unseen’ client service elements – the touchpoints such as phone calls. Here are the results.
From these results we see that a healthy 30% of firms surveyed said they answered all of their incoming calls. However 68% of firms stated they don’t answer all of their calls.
There might be more channels than ever by which to contact a business, but the telephone remains the most important channel of business communication, with 56% of UK companies citing it as the principle channel to converse with clients.
The largest firms were the most confident in handling their communications with 53% stating that they answered all of their calls.
But 20% said they didn’t answer the majority of their calls – the highest of all of the firm sizes polled. The mid-size and smaller firms surveyed were satisfied they answered the majority of their calls.
If you think phone calls don’t matter anymore, we have some news for you. They do.
People will pick up the phone when they are the most interested in your services. Actually, businesses receive 34% more calls now than they did 5 years ago – particularly after the effects of the Covid-19 lockdown.
For over half of UK businesses, the phone remains the most popular way for clients to get in touch.
This proves the need for human contact in spite of newer communication channels. Email is the only day-to-day channel that comes close to matching the preference for verbal communication over anything else.
So as a first step to getting more from your marketing spend, make sure all clients have their calls answered and handled with first-class care. Simple.
Given the majority of firms polled said they are putting their relationships with their existing clients under the spotlight, we wanted to know how exactly they plan to do this.
It seems like such a simple notion – give the best service possible. Yet so many businesses haven’t quite mastered actually doing so. And that’s putting it mildly.
There is a whole industry aimed at getting accountancy firms to put their clients first as people, not just their clients’ work. I do have hope that a corner is being turned this year.
I’ve spoken to more managing partners than ever who are doing just that – taking physical steps to improve their client’s experience of their firm. It’s great to see.
The fact that firms state they plan to take proactive client management steps, and quicken the speed they are addressed feels like a huge step in the right direction.
The trick is to treat clients as people first. Something that is very quickly forgotten when dealing with their work.
But humanising the people and business owners behind the numbers is felt by those who need it most. Your clients.
1. The simplest client experience tip of all? Answer the client’s call on the second ring
2. Business ownership, whether successful or struggling, is lonely. Call one client a day with no agenda other than to ask them how they’re doing. Two times out of ten – on average – this will lead to extra work orders.
3. A huge amount of processing work related to compliance can now be automated. Make sure you’re not charging clients for tasks performed manually that your competitors can automate.
4. So many firms promise a ‘pre-year end meeting’ and so few actually deliver them. If you’re failing on that promise, don’t expect loyalty from your client to be a given.
5. Client referrals are the diamond standard of all new client sources. Rather than asking for referrals, ask a client to boast about how well they’re doing with your help to a non-competitor of theirs. This way you go from asking for a referral to doing three people a favour.
6. The client experience you can offer for your Grade A prospects improves significantly when you divest yourself of Grade D clients.
7. Breaking news: your prospective clients don’t care about: 1. the letters after your name and 2. your service lines. They only care about how you are going to make their business and their life better, as a result of working with you. Which of these things can they learn about on your website and marketing communications?
The ways in which firms deliver better experiences for clients are notably different by the size of the practice.
The largest firms’ focus for improving client experience was offering complimentary services for clients (47%) compared with 33% on average for all other sized firms.
The large firms (250-500+) were also prioritising improving the way their inbound calls were answered for clients (47%), compared with 32% on average for the small firms surveyed.
When we look at the results by region, we see that firms were quite evenly consistent with improving their inbound call management, suggesting that firms of every ilk recognise it is a straightforward and impactful change to make.
Wales and Scotland were the most focused on introducing client-facing software. London, the Midlands and Wales were leading with offering more services to their clients.
It is encouraging to see two thirds of firms reported having a proactive plan which is designed to improve client service.
Especially so, given that this was reported as the main priority for all firms in 2021, so it’s not just a pipedream, firms are putting it into practice too.
Interestingly, smaller firms were most likely to have a plan in place with the 100-249 employee category most likely at 68%. 53% of 500+ employee firms reported not having a plan for this.
It can be overwhelming when beginning an improvement plan. Just deciding where to start can be daunting. Here’s our recommended checklist to create your own client service improvement plan.
The areas your accountants grumble about indicate fragility. Do they complain about client phone calls? Do you lose a high number of clients during onboarding? Don’t tell yourself it’s the norm. It can be improved upon. These give you clues as to your weakest points.
It’s an olden but golden rule. Your clients are the best people to tell you where to improve. Hold focus groups. Speak to trusted clients. Remember to listen. You will get more from these conversations than speculating where you yourself can improve your firm’s service.
Draft a paragraph describing how you want a client to talk about your firm, e.g. “They’re really forthcoming with advice and helped me double my revenue in two years.” This will give you a focus.
Without staff, there is no firm. So if you’re making big service changes they have to be on board because they’ll be delivering the improved service. Ask them what they want to improve.
You can always tell if a person has worked in service, even as a waiter in their teens. Being able to deal with customers is a unique and necessary skill. Online courses are available, as too are customer service coaches.
Have a key account manager proactively call each client within one month. Make sure every call is answered without relying on voicemail. Whatever you choose, make it a tangible thing to measure.
One thing is for certain, accountancy firms cannot afford to rest on their laurels over the next 12 months – and beyond. Clients are in for some upheaval and will need your support, so be ready.
The message from accountancy firms and consultants to the practice is: whatever your particular focus – be it growth, cost cutting, or shoring up your existing clients – don’t get caught on the back foot.
Loyalty is being replaced by availability. We know from previous times of economic turbulence that people like direct communication with their business partners. It’s reassuring. Particularly when they have an urgent request.
Our parting advice is to take steps now to mediate this ‘noise’, and protect your accountants so they can focus on their work.
We hope this report has given you an idea of how UK accountancy firms plan to react to changes, and their strategies for improving their clients’ experience with them.
Moneypenny commissioned a report conducted by Censuswide, who surveyed 250 senior decision makers within UK accounting firms with 50+ employees in December 2020. Unless otherwise stated, all graphs and statistics are sourced from Moneypenny. Clients and partners were also invited to provide viewpoints on the various findings throughout. Questions included single and multiple choice answer formats.
12 Feb 2024
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