Private Client Practice – Poaching business

When it comes down to advising small businesses, accountants think they are the best. But when Business Links came along in 1993 it challenged accountants in their traditional area of services and threatened to erode their fee base.

Luckily for accountants, the service provided by different Business Links offices across the country has, at best, been variable. Since they opened their doors in September 1993, they have striven to provide small businesses with one-stop advice shops. The plan was to give small businesses help in improving management competence in business planning, financial management, staff training and development.

In reality, many of the people who have used the service have walked straight out of the Business Links office and into the accountant’s next door.

But that could now be about to change. Small firms’ minister Barbara Roche announced earlier this year that the whole system is to be revamped in an effort to forge closer links between the organisation and businesses in the local community. Accountants are grumbling that this move could leave them out in the cold.

Roche wants to make the system more customer-driven and standardise the service that businesses can expect to receive from Business Links. She has recognised that the service differs across the country and that the quality of advice, the packages of help on offer and even the opportunity to complain about any poor service is not consistent.

Roche wants to restructure the service to strengthen the ties that bind advisors and Business Links. ‘Both government and business have their roles to play and we are making particular efforts to ensure that government works in partnership with business. We want our government to be an enabler rather than an enforcer,’ said Ms Roche.

Under her plans the 241 established centres will be encouraged to co-operate with the accountants, solicitors and banks that they work with and will initiate a drive to increase their profile. The introduction of league tables is also hoped to improve Business Links and make them more approachable.

The package also includes an Internet site and urges smaller firms to take advantage of new information and communications technology. An ‘enterprise zone’ will point small businesses to information on the World Wide Web that should help them improve the way their businesses work.

The service will provide businesses with an army of ‘personal fitness trainers’ in what the President of the Board of Trade, Margaret Beckett, believes will make Business Links ‘simply the best.’

In reality, it will still be the Business Links’ personal business advisors (PBAs) who will give businesses a free initial consultation. They prepare a report and suggest ways in which the business can progress. The PBA, an experienced business person, then refers the client to the appropriate people.

After this first consultation the Business Link will charge for further services provided by the PBA at a rate of #250 per day. This is subsidised by the Department of Trade and Industry at a rate of about 50%, because they calculate that any consultant in the private sector not affiliated with Business Links would charge around #500 per day.

If the business needs an accountant, the Business Link provides it with a list that comprises accountants registered with the office. The client would have to pay for any services the accountant gives after the referral.

Bob Bhabra, head of business advice at the Greater Nottingham Business Link, says: ‘The government is saying that it is not about to wipe the slate clean and start all over again with Business Links, but that it wants to enhance business prospects, and ensure customer service is delivered.’

But some accountants are worried about the proposed changes. They fear exclusion from the register and a duplication of their services. ‘If someone offers three days’ consultancy free then I would see this as a threat. They don’t talk to us enough and say “look what we can do for your client”,’ says Gary Abbott, partner at Bentley Jennison, chartered accountants in Nottingham.

Some accountancy firms even fear the advisors in Business Links will poach prospective clients. But Tony Howell, corporate services partner at accountants Pannell Kerr Forster – a PBA liaising with Business Link Greater Nottingham – thinks this unlikely.

‘There is a certainly a tension about people coming in and giving free advice. But the client is more likely to go to an accountant they have known for years. Business Links needs to resolve the issue of the perceived competition between consultants who are working in the Business Links, and firms of accountants historically linked to that client. But human nature takes over if a PBA offers their advice for free,’ says Howell.

Roche plans to involve Business Links heavily with the regional development agencies in the near future. Together, the two bodies are supposed to tackle the needs of business in the regions.

They will measure the effectiveness of Business Links and provide a usable complaints structure. Bhabra believes they will act as a policing agency to the regional structure of the links.

David Tinker, secretary of the enterprise group of the English ICA, says: ‘Business Links vary enormously in quality, and some of them are pretty dire, which is part of the problem. They need proper controls so the providers (accountants, solicitors and banks) can work better with them. It is important that our own districts liaise with Business Links and the regional development agencies should facilitate that.’

The lack of co-operation between accountancy firms and Business Links is a problem recognised by the Trade and Industry Select Committee in 1996, and has prompted a working party of the English ICA and ACCA. This is looking at how the profession and Business Links can help each other.

But as of December 1997 it had only had one meeting and had not reached any conclusions.

An enterprise liaison officer for the English ICA at regional level felt there was some disappointment in the direction of the new proposals. ‘Ms Roche has got the direction right, but the specifics are running against Business Links.

It should service the market where there has been a failure and not step on the toes of chartered accountants who feel they should be the ones who do the work for a business.’

Others feel that the revamp will give accountants the opportunity to win more clients, especially if they are registered as consultants to give advice in their local Business Link. ‘We have commonality with Business Links,’ says Howell. ‘Smaller businesses that have little money to spend on advice are usually the clients that go into the Business Link. But they still need the expertise that we provide if they are to turn into successful operations.’

Bhabra is also quick to allay fears: ‘We are not here to compete with accountants. We undertake an analysis of a business and make some meaningful recommendations for that business to go forward.’

A #1.5m advertising campaign will promote Business Links, and a rise in the number of businesses using the service should inevitably lead to more clients needing accountants.

It is up to the accountants to get involved and register with their nearest Business Link. Those who are content to sit and wait for business to come to them could find themselves isolated if Roche’s initiative is successful in promoting the service.

What remains is the problem of perception and drawing up the role accountants will play under the new scheme. The threat is more likely to be imagined than real. But unless accountants are prepared to discuss their fears with the Business Links network, they could feel even more out in the cold than they need to.


– National standard of professional competence.

– Development framework.

– Effective board development procedures.

– A stronger accreditation criterion to ensure a Business Link is recommendable.

– Accreditation Advisory Board (AAB) to credit those with entrepreneurial culture.

– Representation of SMEs and members who are independent of the agencies providing the services.

– A ‘benchmarking’ process comparing key processes with the ‘best class’ in the private sector.

– Development of the European model, ‘business excellence’, in Business Links.

– Regional development agencies and partnerships to develop centres of expertise.

– Prospectus setting out the government’s priorities for centres of expertise.

– Networks, national partners and the DTI agreement on best practice.

– Enterprise Zone Internet site.

– Annual stocktakes to promote action and improvement.

– Assessment of the service through published league tables.

– A national customer service statement for Business Links.

– Consultation with SMEs on how to highlight this statement to existing and potential clients.

– Establish a national Business Link complaints hotline to register and follow up complaints.

– Annual stocktake of the Business Link service and report on the results to Parliament.

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