In 2018 alone, 2.6 million Australians were employed on a casual basis, while another 1.3 million were self-employed or sole traders – so what does the rise of sole traders mean for traditional firms?
The good news for larger operators is that the growth of smaller practices and sole traders doesn’t have to spell disaster for their long-term stability. On the contrary, they have the capacity to futureproof themselves by adopting the same modern strategies as their less-resourced counterparts.
Digital technology is empowering smaller practices
Sole trader accountants and small firms employing just two or three people are nothing new to the accountancy industry. They’ve been around for as long as the Big Four, though most have lingered in the shadows – until now. The digitisation of most industries has allowed these small operators to harness the power of technology and hyper-connectivity to reach audiences that were once only able to be reached by big practices.
The availability – and the lower cost of entry – for a range of digital accountancy solutions means it’s now much easier for sole traders and small practices to increase their output. No longer are they hampered by reams of physical paperwork that restricts the number of clients they can manage. Instead, automated workflow software allows them to evaluate the piles of data produced by their small to medium-sized clients much faster – not to mention provide better predictive analysis to inform their decision-making.
Slowly but surely, the technological revolution is bridging the gap between small and large firms – and the big players need to recognise this change in dynamics.
Disrupting the industry
Despite bigger firms having vast resources (financial, personnel, systems, etc.), major corporate clients and much higher revenue streams, their size is a double-edged sword in the fast-evolving digital world. Unlike sole traders and small firms who can stay agile and pivot their strategies at a moment’s notice, large firms are often hamstrung by their established conventions and inability to adopt new ways of working in a short period of time.
That means that while many large firms have stayed the course and maintained their ‘traditional’ way of doing things, smaller practices have recognised technology’s ability to streamline their operations. And for bigger firms, the need to remain competitive in an ever-growing pool of competition can’t be underestimated, with 31% of businesses stating that they would switch accountants if their business needs changed.
From artificial intelligence automating time-intensive, manual processes, to expediting client-facing documents and reports, small firms now have the capabilities of larger businesses – without any of the negatives like big overheads, staff-management duties or the need to report to a board or shareholders.
Are jack-of-all-trades really putting big firms out of business?
While this is great news for smaller firms, large practices aren’t going out of business any time soon. On the contrary, they can see this as a challenge to start adopting what their smaller counterparts have been doing for years. This can be achieved in a number of ways, such as:
- Hiring for new roles: Smart firms are recruiting for specialist in-house services, such as financial planners and business development managers. Data analysts and business advisors can also bolster a large firm’s offering and provide more client services than is possible for small practices.
- Encouraging the ‘jack-of-all-trades’ worker: With AI and automation eliminating the need for humans to do repetitive manual tasks, accountants can be freed up to take on more creative and client-facing roles.
- Integrating their systems: Responses from the latest Good Bad Ugly Benchmark Report found that most accountants are challenged by a “lack of integration between systems”. A single, centralised solution can eliminate roadblocks and consolidate tasks across disparate systems.
Futureproofing yourself against the tides of change
The bottom line is that the future of accountancy goes beyond just the digital. It’s also about leveraging the power of a globalised economy and reaching into offshore markets and being reactive to changing customer expectations. Collaboration is also becoming more important for firms who want to diversify their offering.
But when it comes to streamlining operations and maintaining a competitive advantage over sole traders and smaller firms, that can be achieved by something as simple as automation workflow software.
Workflow by APS, for example, can help futureproof your business by solving common problems like managing staff capacity to increase productivity, eliminating resource gaps through greater oversight, and allocating tasks according to their urgency – which means no jobs fly under the radar.
Large firms must take the lead from how smaller practitioners have been operating in recent years. The gap is closing, but one way big accountancy firms can maintain their competitive advantage is by embracing the power of workflow automation software.
To find out more about APS software, visit www.aps-software.com.