22 Aug

Knowing when to show them the money

capitalise global accountantI’ve written a number of pieces over the last couple of months about the way in which the accountancy industry is being changed and shaped by the digital age.

Tech advances are giving professional services firms including accountants the opportunity to move from a cost centre to a value driver for the businesses they serve.

Rather than focus on financial administration, practices for SMEs are increasingly offering a far broader and more consultative set of financial management products and services.

With the SME economy an ever buoyant part of Britain’s business fabric, advice for startups is widespread.

However, financial support for the businesses that find themselves in between – neither startup nor corporate – is regularly neglected. Growth stage businesses can present the most challenging clients for accountants. But these businesses are often open to a high level of engagement with their accountant.

Business funding marketplaces, such as ours, are giving accountants the power to take their counsel to the next level for these high growth clients.

But how can you identify the optimum time to suggest a financial injection?

  1. Going global

Sooner or later, an SME is likely to look longingly beyond the UK borders. Indeed, recent research from Kingston Smith demonstrated that 60 percent of the SMEs they surveyed export to both the EU and the Rest of the World.

While exporting brings growth potential and increased revenue, it also often heralds significant expense. Expanding into global markets can be a daunting proposition for a small business client.

Louis Taylor, CEO of UK Export Finance (UKEF), has said that “no viable export should fail for want of the right finance or insurance”. Indeed, UK Trade and Investment (UKTI), UKEF and the ICAEW are already working together to help accountants better understand and assist their exporting clients.

Capitalise – as an ‘Exporting is Great’ partner – is also working closely with accountants, to help them advise SME clients on export finance options.

  1. Selling like hot cakes

Landing a major contract can feel like the ‘big break’ an SME has been waiting for. Unfortunately, without appropriate financial planning, it can turn into the straw that breaks the camel’s back.

More stock and raw materials, new machinery, new staff, or all of the above – understanding the financial implications of this kind of major business decision will help you offer a far more valuable service to your SME clients.

  1. ‘Tis the season

A lot of small business are beholden to seasonality in their sales cycle, purely by virtue of being part of a specific industry. This can present a financial challenge not only during the off-season, when times are tight, but in ensuring the flexibility necessary to react quickly to seasonal change.

Do you know which of your clients is impacted by seasonality? Suggesting a bespoke financing option to ride the peaks and troughs of the financial year could be the difference between an SME client remaining on your books, or falling victim to the tides of change.

As an accountant to an SME, you can often feel like an extension of a small business team, even playing the role of a Financial Director in some cases. In these instances, it is imperative to know that business’ industry inside out in order to give the best counsel.

It is important to seize the moment when it comes to addressing SMEs’ financial needs. With so many finance options on offer, from banks, independents and alternative lenders, in the past you could be forgiven for simply recommending the comfortable, mainstream option. Now, however, online lending marketplaces are giving you the potential to provide high level financial counsel on bespoke funding solutions for your business clients.

It’s time to embrace this new digital funding era. It’s time to show them the money

12 Apr

Becoming a professional chameleon 4 tips for accountants working with SMEs

Capitalise Global AccountantAs an accounting professional working with small businesses, you have the opportunity to become a professional chameleon, offering counsel far beyond your traditional remit.

Working with our partners – such as PKF, CIMA and the Association of UK Accountants – we hear this on an almost daily basis. Many, it seems, are already aware of the need to broaden their skill-set to serve particular clients.

As the number of high-growth SMEs reaches its highest level since the dot-com bubble burst in the early 2000s, this market presents an incredibly lucrative opportunity.

Becoming an indispensable source of business knowledge to your SME clients will not only benefit their business prospects, but it also secures their custom in an increasingly competitive advisory landscape.

With this in mind, Capitalise has pulled together some tips on how you can go the extra mile for your SME clients:

Cut through the red tape
Develop a working knowledge of the red tape challenge associated with SME expansion activity. Build up useful resources on these topics that you can share with clients. These may include areas as varied as employment, data, or environmental legislation.

While this is traditionally the preoccupation of the SME’s legal counsel, familiarising yourself with these potential pitfalls will allow you to advise confidently, while also providing an extended service to your client.

Find finance
As SMEs face sustained pressure on their financial well-being, being able to advise in the area of funding is an incredibly valuable asset. While banks are the obvious, traditional option, the recent boom in alternative finance can not be ignored. The Alternative finance industry is now worth an estimated £2.2bn a year to UK SMEs, based on figures from 2015.

The end goal is to facilitate introductions between funding sources and SMEs. While this can be done the old fashioned way, sites like Capitalise.com are increasingly empowering accountants through technology.

Become the introducer
If good business is built on solid relationships, then being able to forge these relationships will always be viewed as a valuable client service. Think more laterally about what kind of relationship would be of use to an SME, whether this be with other clients or external professionals.

Your aim is to create a mutually supportive and empathetic environment in which beneficial insight can be shared.

Hone your speciality
If providing all of these additional services to clients feels a little out of your comfort zone, then consider providing only a handful but ensure quality in each. Clients will always value well-informed, strategic advice, it takes time to build up.

Assess which areas of ‘value-add’ you should be investing time in, and which can be outsourced to the likes of finance comparison platforms. This will be to the benefit of not only your clients, but also to your firm’s reputation within the SME community.

As long as economic uncertainty continues to drive competition within the SME arena, the goalposts for accountancy professionals will continue to shift. An SME now sees squeezing as much value and counsel as possible from their accountant as a necessity.

While this will take some time to adjust to, it’s worth bearing in mind that – in this fast paced SME landscape – the small businesses of today are likely to be some of your largest clients in the near future.

Becoming a professional chameleon may be challenging, but it is guaranteed to pay dividends in the long term.

Article by: 

Paul Surtees, MD and Co-founder of Capitalise