Accountants looking for another reason to justify technology investments in their firms should consider this: The firm’s next generation of business clients are likely to require accounting services that are all or mostly digital. Moreover, younger business owners, in particular, expect accounting services that are in the cloud and accessible on mobile devices.
These are among the findings of a recent survey of 1,000 business owners by business payments network Bill.com. The survey found that all age groups of business owners – but particularly those younger than age 55 -- prefer their accountants to handle all or most of their accounting work paperlessly. Millennial business owners (which for this survey included owners younger than 39) overwhelmingly preferred paper-free accounting, at 78 percent. A solid share of owners 56 and older (45 percent) also favored the no-paper approach.
This makes sense, given the benefits of being able to access important financial information when you need it and the ease of searching and sharing documents online, the survey sponsor said. The reasons for this are that many people are trying to cut back on filing and storing paper, and business owners are often looking to reduce the complexity of running a business.
‘Critically important’ technologies for clients
Furthermore, the survey found that younger business owners are inclined to use accounting firms that utilize and offer modern technology. The top technology tools millennial owners desire were cloud-based technologies, online invoicing and digital payments, Bill.com said. Mobile access was also important to 25 percent of the younger business owners. Some owners actually require these leading technologies; 1 in 4 of the millennial owners surveyed said it is “critically important” that their accounting firm utilize mobile and cloud technologies.
In addition to helping accountants meet the requirements of younger business clients, many types of technology tools can help keep clients satisfied concerning quality-of-service needs.
1 in 4 of the millennial owners surveyed said it is “critically important” that their accounting firm utilize mobile and cloud technologies
For example, 42 percent of millennials said a critical trait for their accounting firm is that it “translates complex financial concepts into terminology and reporting I can understand.” In fact, millennials identified this as a critical trait nearly three times as often as they mentioned they’d like a firm that “provides the least expensive service available.” Accountants who use financial analysis solutions that benchmark businesses against their peers, identify which cash-flow drivers to improve and provide straightforward narrative reports on financials are able to meet these important needs and deepen client relationships at the same time.
Other traits that millennial business owners ranked as most important included:
• Responds to my communications in a timely manner
• Provides strategic insight and guidance for my business
• Is versatile and able to provide a wide range of accounting, tax and financial services
• Has an in-depth knowledge of my specific industry
Technology can assist in all of these areas. In addition to making it easier for accountants to provide personalized insight for specific industries, technology can generate timesavings by automating basic, repetitive tasks. This leaves accountants with more capacity to respond in a timely manner and provide customized services.
Data supports virtual accounting firm model
Less-valued traits, based on the survey responses, were having the least expensive pricing, being part of the local business community and having the ability to meet face-to-face with short notice.
“The fact that millennial business owners show a preference for cloud-based technologies, online invoicing, and digital payments suggests that they are receptive to the virtual accounting firm model,” the survey noted. “Since these technologies enable accounting services with only a device (laptop, tablet, smartphone) and an internet connection, the need to have an accounting firm nearby or in the same region diminishes.”
Another finding of the survey was that millennial business owners, more so than older business owners, prefer monthly flat rates or fixed fees when paying for accounting services, as opposed to fluctuating bills based on an hourly rate. Millennial business owners have grown up with Netflix, Spotify and other subscription-based services, so it’s not entirely surprising that they are comfortable with these less common methods of billing for accounting services, also known as value billing.
eBook: The Definitive Guide to Improving Cash Flow
Webinar: Expand Your Firm’s Advisory Services
ProfitCents helps thousands of accounting firms and business consultants acquire and retain clients through differentiated, high-value services. Build or strengthen an advisory practice, leverage robust benchmarking data or streamline the audit process. Learn more by watching a brief overview video.