It is a universally acknowledged truth that desktop accounting is becoming extinct. We’re living in the age of the paperless, mobile and global office, and there’s little call for data entry or book-balancing. As a bookkeeper whose business model has revolved around data entry for literally thousands of years, the prospect can be quite scary.
But it doesn’t have to be.
Instead of fearing the impact of cloud technology, bookkeepers should be embracing it. Cloud-based accounting makes bookkeeping much more efficient. It is not the harbinger of doom for your business, but a tool you can use to improve your system.
You now have access to all the information you need, 24 hours a day. Neither you nor the client has to print out screeds of paper or travel across the city to deliver files.
To a large extent, the automated bank feeds and rule-based reconciliation mean a large chunk of a bookkeeper’s time is now freed up. What are you going to do with this time?
Well, you could take on more clients, for one. More clients = more revenue. As businesses flourish in the wake of the global recession, more and more people will need the services of a bookkeeper.
Cloud-based accounting software will never eliminate the need for bookkeepers because a person needs the financial knowledge to understand what is happening with these programs. Most business owners would rather outsource this to someone with the knowhow than learn themselves.
Cloud-based accounting is also opening up new opportunities for bookkeepers. Any part of business where a sale, payment, or invoice is involved comes under the bookkeeper’s umbrella. You might be able to provide additional services under payroll, accounts payable, accounts receivable, stock, point-of-sale, e-commerce, etc.
It’s all about helping your client to become more efficient and giving the client advice about the best way to record their information.
BoxFreeIT interviewed Rob Comelli, former CEO of the Association of Accounting Technicians, about the future role of bookkeepers in Australia. He had some really interesting insights into the value bookkeepers can add to their businesses without breaking the rules around being a BAS Agent.
Positioning Yourself As A Consultant
Some business owners will decide that they can do their own bookkeeping with cloud accounting software. What should you do then?
It’s important not to write off that client immediately. We all know that bookkeepers provide value beyond simple data entry, but the client might not understand that. By listening to their problems you might be able to come up with a solution that could benefit you both.
You could demonstrate that, looking at their time on an hourly rate, it is more cost-effective for them to hire you than to do it themselves. You might use their financial reports to show them where they can trim fat from their business.
Otherwise, they will probably need training to understand how the system works and what they need to do every month. Afterwards they may need support as they learn the intricacies of accounting software. And who better to provide this training than you?
Offer a pared-back service where you only perform some of your usual tasks and they conduct the rest. For example, you could do the bank reconciliation each month, or offer a quarterly review of the books. This will help your client identify problems before end-of-year, but won’t be as expensive as your full bookkeeping service.
Show them ways of improving their efficiencies in other areas, perhaps by using workflow management software to increase their productivity.
A bookkeeper can be particularly effective in the area of business-based technology. Demonstrate your value through the extra advice you provide.
This type of arrangement is good for your bottom line too because your fee as a trainer and consultant should be at a higher rate than what you’re charging for basic monthly bookkeeping services.
Action Steps for Bookkeepers
So what can you do right now to help facilitate change within your business?
Get familiar with the technology. This means not only learning all the features of cloud accounting software, but also learning about the add-on programs and the value they can provide to your clients. Use the technology yourself, attend local training sessions, watch online training, and attend events.
Learn from leaders in accounting/bookkeeping. See what others have done and learn how they did it. Attend industry conferences, such as The Bookkeepers Summit and Xerocon, and also by reading case studies and blog posts online. The Pure Bookkeeping Blog and The Freelance Bookkeeper Blog are great places to start.
Figure out new services. The role of the bookkeeper is shifting from data entry to to data management. Brainstorm the types of services and packages you might offer. Think about where your skills and interests lie, and talk to your clients about where they’re feeling stuck in business. You might be able to add value by offering software solutions to help clients manage payroll, e-commerce and point-of-sale.
Learn new skills. Now is the time to start training yourself to give business advice and build on your IT skills. Learning more about solutions, networking and marketing your business could also be extremely beneficial.
Consider rebranding. Are you moving from a bookkeeping model to an indispensable business consultant? Remember, “consultants” get paid more than bookkeepers, so you might want to alter your branding to reflect these changes in your business model.
Forge new collaborative business relationships. There are many people and companies offering complementary services such as accountants, tax agents and cloud-computing business advisers. Team up with these people to share resources, offer referrals and give advice to each other. A strong network will help your business thrive.
Work together with technology providers. Ensure they continue to provide the best software solutions for your clients. You are often the people closest to the day-to-day business, and provide valuable insight into what they need.
This is an edited version of a post that appeared on the WorkflowMax blog.