The accounting firms of today have grown into multidimensional entities. Growth, marketing, building bigger client base, offering more services are now equally as important as managing their current practice. Since the modern economy has converged to become a central marketplace irrespective of geographical boundaries. Partially, it’s possible because of easier market entry created by advances in technology and communications infrastructure, restructuring of product sourcing arrangements, the emergent availability and shifting costs of global labor pools, along with continuous restructuring of capital markets and the rise of new economic powers. With such prevailing conditions, an accounting firm requires to have a dependable business model for ensuring it survival, growth and longevity. Let us look at the 6 crucial markers that may guide your practice towards success.
Building Client Base:
Any business thrives and grows only because of its loyal customer base. You can choose to have more number of services for your clients or, you can select to have lesser services and equally focus on important activities such as customer engagement programs and value-added benefits for loyal, long-term clients. Today, clients will flock to any firm that focuses more on their needs along with hearing them out and providing value-added benefits apart from their services.
Choosing Business Type – Niche v/s Diversity:
Choosing the type of business depends on your clients, and requires a qualitative approach towards identifying their requirements. There are Pros and Cons to both approaches. However, the only important idea is to understand and plan who you want to cater the most; large volume of clients with higher volume of sales at marginal profits, or few clients with proportional sales with higher margin at profits. Pick Your Choice!
Workforce management – Contracting v/s Hiring
No manufacturing unit or business can run without any labor for the functions and needs of that business. Seemingly, today’s firms have various options at staffing, such as contracting or hiring work force for their organization. Outsourcing/contracting is convenient. You select vendors and appoint them for certain remuneration to complete and deliver non repetitive work. It’s quicker with lesser liabilities. Hiring, on the other hand, is a longer process with aiming to retain selected candidates for longer duration, and viewing them move up the hierarchy (based on their skills and performance) within your organization. Today, there are 2 different options within Hiring — local staff, and remote staff. Hiring local staff is the age-old traditional means of recruiting personnel for respective positions. Hiring remote staff is the latest trends where you get numerous facilities, flexibility, and benefits over traditional method of hiring local staff. Today, remote staffing has become a popular choice for several types of industries, which translate into additional benefits such as saving on costs, time and efforts, along with round the clock available work force, lower infrastructure costs, etc.
Cutting cost v/s Rational Investment
Running a business requires shrewd skills when it comes to managing finances. Apart from the fixed costs incurred at the beginning and daily running of the business, variable aspects such as capital or cash flows, liquidity, running capital requirements etc. take more precedence during planning and decision-making. One can have a cost cutting approach when it comes to operating business financials, such as investing lesser, or acquiring assets, labor, equipment, etc. or cutting down on existing such functions of the company such as laying off labor, cutting down on inventory and assets, etc. All of which is only limited by only whatever finances you can spare or arrange for. Alternatively, one can choose to make wise decisions on planning and investing wisely such as when there are good offers on purchasing assets, or planning ahead of peak season for acquiring raw materials or labor, etc. It all depends on the business acumen of the management of the company. Nonetheless, one should observe and predict future possible scenarios, think twice, plan ahead, and decide wisely in matters of business finances.
Marketing – Digital v/s Conventional
Today, no other means of communication reaches out to potential customers as digital marketing does. People around the globe are connected to each other through digital devices. As of today, digital networks is the only medium through which, any sort of information propagates almost without any delays. Moreover, there aren’t any obstacles in reaching out to people scattered across geographically over enormously long distances. These are vast benefits of digital marketing over traditional forms of marketing. Today, Digital Marketing campaigns are designed at utilizing minimal capital and efforts, and delivering higher ROI in shortest possible time frame. Most conventional marketing plans costs significantly higher, while not being able to reach out to maximum potential customers at all. This is why digital marketing today leads all forms of marketing, making them supplemental options to digital marketing. However, the approach shouldn’t be to quit the conventional marketing completely, as this method may bear fruits, but some budget out the hefty sums can be diverted towards digital means as well. This will balance the expenses very much and give a higher ROI.
Self Expansion v/s New Acquisition
Getting ahead in entrepreneurship, you might go ahead with increasing the practice in newer regions. Alternatively, you can also develop other value added services according to new market. Thus, you can go about growing your business by expanding your own firm’s capabilities to fill in this market gap, and benefit from the lack in any products thereof. On the other hand, you can even go about having a merger or acquisition with another business organization who exists in the industry and has significant standing and loyal customer base for continuing operations of those particular services. In the former case, it will take you time, efforts and capital to reach to the position for catering to different opportunities as and when they make their presence in the market. With acquiring or merging with an existing firm, you have the added benefit of an already established organizational unit, and simply take the reins of management and lead the running business operations.
To have a successful business organization, all it takes is precision business acumen, informed and wise planning, forecasting, calculated decision-making and all possible forms of risk management.