70% of small businesses would not recommend their advisor to others – and over a quarter said they are likely to switch accountants, according to research by Xero.
Xero studied businesses which use any online or digital bookkeeping tools, and found that 80% of small businesses are working with an external accountant, yet their satisfaction is remarkably low.
“It’s vital that accountants are helping their small business clients succeed – and it’s a concern that so many business owners wouldn’t recommend their advisor to someone else,” said Damon Anderson, director of partner and product at Xero.
Over one third of small business owners even go as far as telling people to avoid their accountant, saying that they don’t understand business challenges, don’t provide the right support, charge too much and aren’t keeping up with technology.
With the advent of new legislation such as Making Tax Digital, there is now an even bigger impetus on client satisfaction. The research found that in 2019, when asked about what small business owners wanted from their advisor, they listed: industry insight; proactive advice and support; technical competence and the feeling that they are the priority.
The top mistakes that are causing business owners to switch accountants include: rarely providing support (62%), limited industry knowledge (57%), making them feel like a low priority (55%), being behind on technology (53%), being unresponsive (52%) and not providing enough value (44%).
Tech-savvy firms keep clients happier
When it comes to customer satisfaction with their accounting firm, the firms using online and cloud-based tools seem to be performing much better. On average, tech-savvy firms using online tools have a Net Promoter Score (NPS) of 20 versus -5 for those still using traditional accounting tools such as desktop software and paper receipts.
Anderson said that instead of being bad news for accountants, it represented a “real opportunity for accountancy firms to really benefit”.
Sharon Pocock of Kinder Pocock has been able to increase her net promoter score to 71 through focusing on client service. “Our biggest focus as a firm is on client service and we’re proud to have been recognised for it,” she said.
“We block out one day a week to look at the good and the bad of client servicing and ensure our clients needs are always listened to. We are known as a down-to-earth and accessible firm as a result. We find it’s much easier to satisfy clients when you put them at the centre of your business.”
Paul Bulpitt, from similarly successful firm The Wow Company, added: “Most of the time, businesses switch accountants and come to us because the firm they’re leaving just waits for their clients to call in for help instead of proactively delivering value. When we ask these businesses why, they say their old accountant didn’t care enough about them to engage with them frequently, or even simply return their calls.”
Anderson urged accounting firms to heed The Wow Company and Kinder Pocock’s example.
“By adopting the right cloud tools, they’ll be in a far better place to improve their NPS score. Take Sharon from Kinder Pocock or Paul from The Wow Company. They’re amongst the many pacesetters who have seen their businesses prosper by taking the simple step of improving client satisfaction,” he said.
“In the wake of Making Tax Digital, it’s never been more important to be the driving force of huge technological change,” Anderson added.
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Small businesses ‘unsatisfied’ with their accountants