ACCOUNTING PRACTICE MANAGEMENT MARKET ANALYSIS

Accounting firms require specialized software, tools, and technologies to run modern accounting practices efficiently. However, the costs associated with procuring and maintaining such solutions is substantial. Switching to advanced cloud-based accounting management systems requires heavyweight initial investments. Moreover, as technologies continuously evolve, firms need to keep upgrading and integrating new features to retain a competitive edge, which translates to additional recurring operating expenses.

The costs of hiring and retaining top talent also weighs heavy on accounting firms. Attracting and training specialized professionals such as CPAs and bookkeepers demands competitive salaries and benefits. Firms located in metro areas with higher costs of living find it especially difficult to manage personnel expenses. Staff turnover further increases costs due to overhead of onboarding replacements. The COVID-19 pandemic disrupted operations and accelerated the need for digital transformation across the industry. However, it further constrained already tight budgets by lowering demand for some accounting services in 2020.

Market Opportunities: Untapped rural areas

While urban centers have traditionally been the focus, there is substantial untapped potential in expanding to rural and agricultural communities.

Rural regions are home to many small businesses such as farms, shops, and services that still require accounting and bookkeeping assistance. However, access has been limited due to lack of familiarity with newer tech solutions and distance from metro accounting offices. As internet and mobile connectivity improves across the world, including in remote locations, it opens the door for accounting firms to utilize digital and cloud-based practice management software to better serve far-flung clientele. Countless small enterprises in the hinterland stand to gain accessibility to compliance, reporting, and advisory services virtually through online tools.