According to Accounting Today, there are more than 14,000 CPA firms in the United States that have at least two partners. Just 100 of them have revenues exceeding $40 million, meaning that a vast majority of them are mid-market or serve small businesses and individuals. While it is easier than ever to start a business today, accountants and tax professionals are facing unprecedented challenges in growing and sustaining their practices.
Whether you just opened your firm or have been established for years, white-label accounting services may be the solution needed to achieve your desired growth rate. Here’s how.
Factors That Make Accounting Firms’ Growth Untenable
The profession has become more technologically demanding. Strong knowledge of accounting standards and tax laws is no longer enough by itself. Even though 88% of the respondents of a 2020 Bill.com study stated that they believe automation will help their businesses grow, accounting professionals are having a difficult time staying on top of the latest software and cybersecurity standards and implementing tools and automation. The need to constantly gain new skills and learn new software packages, and their subsequent updates, steals time from serving high-value clients and gaining new ones.
It is challenging to find staff with the right skills. Each small, independent tax and accounting firm has unique staffing needs. To grow beyond a solo or two-partner practice, hiring employees becomes inevitable. However, a friction point is eventually reached where staff with the proper accounting and technical skills are needed, but paying their salaries loses feasibility when revenue remains stagnant or contracts. Staff not only need the precise skills for the clients you serve, but you face the challenge of hiring staff that may not always be needed.
Self-service packages began offering more advanced support. Many tax and accounting practices provide a review service for self-prepared tax returns and financial statements. As more users want a “one-stop-shop” approach, software companies started contracting with tax and accounting professionals to offer that support on their end. That is causing small tax and accounting firms to lose a key revenue stream and source of new clients.
The Benefits of a White-Label Partnership
Accounting and tax professionals can rise above the challenges presented by today’s technological and regulatory environment with outsourced accounting services, also known as a white-label accounting firm.
White-label accounting consists of accounting solutions, outsourced bookkeeping services, and back-office services that are performed by an external firm but can be presented to the end client as your own. The white-label accounting firm’s products are totally absent of their branding so that your own can be put in its place.
If you want to take on more clients but don’t think you have the capacity to currently serve them, a white-label accounting firm like Pacific Accounting and Business Services can take on this overflow work while keeping your firm’s name and branding on the end result. Our team of more than 500 accounting professionals provides a full suite of back-office solutions and full-service accounting support, whether you require outsourced accounting services or just a technology partner to step in and provide you with the right solutions.
White-label accounting services are highly scalable, making them ideal for tax and accounting firms that are growing and facing a plateau. Our professionals can take on additional clients as you have them if you’re unsure whether you will need another employee. Technology solutions can also be scaled to your firm’s specific needs without unnecessary extra features.
If you are having difficulty staying on top of the latest technological shifts, white-label accounting firms can handle this aspect while you focus on furnishing your accounting knowledge to your clients and growing your practice.