Turning commodity services into a goldmine
Q. There is a lot of focus now on advisory services. Why are you advising accountants to offer commodity services?
A. Don’t get me wrong — every accounting firm must strive to offer advisory services. That’s an essential way to add value to clients’ businesses and make your firm more relevant. I’m just reminding accountants that there are also other simple and highly effective ways to grow their practice and their profits — and we should not ignore them. Technology has given accountants the power to transform services like payroll, transaction processing, and bookkeeping (which traditionally have been low-profit, high-hassle commodity services) into highly profitable offerings. The key is to use professional solutions that take full advantage of new capabilities of the cloud and other prevailing technologies. Another important point is that, if offered strategically, these commodity services easily lead to offering advisory services.
Q. How can payroll be turned into a highly profitable service?
A. Here’s an example. There are firms that currently process 150 or more payrolls using just one staff member. Simple math will tell you how profitable that would be — and automation achieved through cloud technology makes it possible. Today’s most advanced solutions automatically handle direct deposit, tax deposit, and filing of tax forms. Firms don’t print any checks or perform data entry. Unlike tax, accounting, and audit, payroll requires little professional time. Furthermore, payroll can easily lead to 401(k), HR, and other advisory services.
Q. Is there a similar profit potential in transaction processing and bookkeeping services?
A. Absolutely. Transaction processing is an integral part of client accounting services (CAS). If you want to offer CAS, you need to offer transaction processing and bookkeeping services. While traditionally they have been high-hassle, low-margin services, today they can be easily turned into profit-makers through a high level of automation and a streamlined workflow. Cloud-based professional solutions created exclusively for offering CAS have those capabilities. They enable your staff to do the tasks your clients’ staff currently does — only easier, more accurately, and in a fraction of the time — all without leaving your office.
If you give clients the opportunity to offload all their accounting work to your firm, while spending not a single penny more than what they currently spend, then most would gladly do so. By having your firm perform the same work in half the time, you can turn transaction processing into a big moneymaker for your firm.
It may be quite a while before artificial intelligence brings major benefits to your practice. But using your “natural intelligence,” you can make your practice thrive today!
For the past 30 years, Chandra Bhansali’s passion has been to find innovative ways for accountants to benefit from emerging technologies. This passion has provided the impetus for the development of many breakthrough cloud solutions for accountants by the AccountantsWorld team, led by AccountantsWorld co-founder Sharada Bhansali.