Steering Through Economic Turbulence: Innovative Strategies for Accountants in the Current Market

Ever wondered how to navigate the rapidly changing economic landscape as an accountant? The Unstoppable Business podcast has got you covered. Our host, Arun Mehra, delves into the significant shifts in the UK economy over the past 12 to 18 months. As rising interest rates and inflation put pressure on businesses, Arun provides a lifeline, particularly to those in the accounting sector. He presents the compliance work that accountants undertake annually as a beacon of steady income, thus alleviating fears of escalating costs or the need to hike prices.

In the second half of the podcast, Arun proposes a road less travelled for accountants - diversifying income sources. He provides rich insights into additional services such as finance directorship and financing that can augment your business. Arun also speaks about managing accounts and dealing with clients effectively. But that's not all; he outlines strategies for adaptation in the future, like the importance of targeting niche markets, the benefits of global hiring to cut costs, and the advantage of exploring more services to offer. So, if you're looking for innovative ways to steer your accounting practice in these turbulent times, this episode is a must-listen.

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Transcript

Arun Mehra: 0:13

Welcome back to the Unstoppable Business podcast by Arun Mehra here today. Now, one of the things that impacts all businesses, but also impacts accountants as well, is the economic landscape, and what we're seeing in this kind of last 12 to 18 months has been a major shift in the UK economy. Obviously, we've seen interest rates rise as a result of inflation rising, and so how does that impact accountants? Now I've seen many, many accountants struggle in this environment. Why? Because they're fearful about putting their prices up, because maybe their clients will decide to leave, and that's their fear in their mind. Or their costs are too high, whether it's staff costs or whether it's other costs building costs, their costs are too high and they're not rising their prices, and that has an impact on margins and profitability of their practice. So there's loads of things that impact accountants from an economic standpoint, but one of the great things about being also an accountant is the compliance work. Every year, without fail, we have to submit tax returns, accounts etc. For clients, and that's a great generation of cash coming in every year, subject to you doing it properly and subject to not having any major issues with any clients. So, as a kind of a platform, that is always a great thing to have in your business, but it's not the only thing you should be having in your business, because, ultimately, you want to diversify your income. And now how do you go about diversifying your income? It's about having other services that you can offer.

Arun Mehra: 1:41

Now I know some clients that offer a finance director service to their practices or to their clients. We offer that as an example. In addition, we offer and that includes things such as managing accounts quarterly or monthly, meeting with the client online, advising them on what to do and how to do things better. In addition, one of the things we also offer is financing. We know clients need to grow in this environment and they're worried about interest rates, so they want to get the best rates for their finance, whether it's an existing loan or whether it's a new loan to grow, or whether it's asset finance they all want finance. So that's a great area to diversify too as well.

Arun Mehra: 2:20

So, going forward, where do we see the economy going? How will that impact accountants? Well, in my view, I think it will impact accountants by those who take on the new ideas, a new way of doing things. Going forward, that means not sticking to Excel, not doing things as you've always done and really kind of shaking up your business model. So what are the examples you might be wondering?

Arun Mehra: 2:46

Well, some of the things you can shape up in your business model are look at how you market yourselves. Do you have a niche market? If you focus on a niche, you're seen as an expert. And if you're seen as an expert, more and more people will come to you. And if you get more and more people coming to you, you can then have that flexibility in raising your prices because you're an expert.

Arun Mehra: 3:05

In addition, you might be thinking well, I've got lots of staff members here in the UK, but not all of them add value to my firm and yet they're just doing the bookkeeping or they're just doing the payroll. Well, there are other ways of doing that. Today we live in a global economy and you can hire staff and run a team globally who can still do a lot of this work at a significantly lower cost for you. Of course you still need people here in the UK or wherever you may be listening to this. Of course you need that because you need those relationships, and those relationships are very, very valuable, but sometimes some of the more mundane and some of the more process related activities can be done overseas and offshore at a lower cost.

Arun Mehra: 3:42

Other things that you can do in your firm is look at what other services you can do. As I mentioned, we do financing. We do a FET NFT service. We also have a buying group for our clients who are dentists. Those are things that we're doing. So there's a lot of change happening in this sector because of recruitment being a major issue, and AI will certainly change the sector, but we still need good people, because good people need to actually ultimately operate and understand AI to drive the firms forward.

Arun Mehra: 4:14

So I think going forward, if you're going to prepare yourself for the future, is listen to more accountants, see what other firms are doing, listen to your peers, join a community, join a different LinkedIn groups, join events. Go to events. Talk to people, because the more people you talk to, the more ideas you'll get, and I strongly encourage you to carry on listening to this podcast. We have a community that you can join which is totally free of charge, and that's not just for UK accountants, for accountants all across the world, because we're sharing ideas and strategies that impact accountants at every level, whether you're an accountant sitting in the UK running a firm, or whether you're an accountant in India thinking well, I'm going to start up my own offshoring firm to support accountants in the UK or US or Canada or wherever it may be. These are things that are changing the world at a very, very rapid pace. So the economy is always changing and the world is always changing.

Arun Mehra: 5:11

What we all need to do is embrace change. If we resist it, we'll be still stuck back in the 1970s, but if we embrace it, we'll be one of the future firms that are actually growing, developing and doing things differently. And that's the key message of this whole podcast today is that we have to be doing things differently, we have to be trialling, we have to experiment. Some things you'll try won't work, I can guarantee it, but some things that you will do will work really, really well. You're thinking oh my god, why didn't I do this before? So if you need any help or if you want any ideas, check out our community, get in touch with me. My team are here to help on a whole range of services, from the free community to offshoring, to supporting with your marketing initiatives as well. So enjoy and look forward to speaking to you soon. Again, thank you.