Everyone has heard a lot about possible mergers between the big firms and how the resultant super-firms will drain medium-sized firms of their clients.
But there are many fish in the pond for medium-sized accountancy practices.
The key issue is how to compete against firms in the same pond, not how to protect ourselves from the top six.
We all like to have new clients contact us through recommendations, but we must also actively seek out new business.
We must identify our strengths and decide who can benefit most from our expertise. Then we must do something about it. Many firms are too diffident to go out and sell themselves with conviction.
Accountants often miss opportunities in the cross-selling of services to clients. Do you always remind your clients you have an in-house financial adviser, forensic expert, insolvency practitioner and so on?
We know that we can offer a very high level of expertise at a more competitive rate than the Big Six would charge, but this must be conveyed to potential clients in no uncertain terms.
Always keep in mind that no matter how long-established your relationship with a company, it will switch allegiance if you price yourself out of its market. Not only must you provide a cost-effective service, but your client must perceive it as such.
This is proving more problematic in the current climate. The polarisation of the Big Six means that they can attract the most able staff with remuneration packages beyond the means of smaller firms. The situation is exacerbated by the thousands of small firms competing purely on cost. You must get the balance right and combine quality service with a fair charging structure to stand comparison with the giants.
At the end of the day, clients prefer accountants who understand their business. They expect proactive input about ways in which they can further develop their business. Only an accountant who makes the effort to understand the intricacies of a client’s business and the market in which it operates can possibly offer the most constructive professional advice. This is where a medium-sized firm has an unbeatable appeal to a medium-sized business.
Ladislav Hornan is managing partner at the London office of Hacker Young.
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