Bookkeeping Automation: Threat or Opportunity?

Published: June 28, 2019
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Like it or not, software automates much of what we do for our clients as accounting professionals. While most of us would love to have most, if not all, of the “grunt work” involved in bookkeeping, automated, how is this changing the way clients view the value of what we do?

What’s the current situation?

Because the software providers are finding ways to streamline the day-to-day bookkeeping work (downloading transactions, gathering receipts, coding those transactions, sending reports, etc.) the speed and accuracy of financial information for small business clients is improving. “Real-time” financial information is becoming the expected standard.

Automation is also driving bookkeeping prices down while increasing convenience and speed. The increased efficiency means we must reconsider our pricing model as well. Basic bookkeeping is now being viewed as a commoditized service. Truth be told, clients don’t like paying for bookkeeping (or tax) services. It’s seen as an overhead cost.

Therefore, if there is a faster, cheaper way to get the required job done (without concern for how or who does it), the cheapest offer usually wins for overhead costs.

The Opportunities that are Opening Up for Us

So does this mean that the only way to compete with the influx of automated bookkeeping competition is to accept slave wages? Happily, NO!

Automated bookkeeping provides us the opportunity to go one of two ways.

1. We can either switch to packaged flat-fee services, become extremely efficient, and compete to take on many more clients to scale up quickly OR

2. We provide more than basic compliance services by expanding to premium-level advisory services. That means helping our clients do more than pay taxes. We support their growth and achievement of THEIR business goals. In this case you would be serving the same number of (or even fewer) clients, but providing them with more valuable services. The ultimate work-less-and-make-more model.

I highly recommend option #2, but I also know of colleagues who are pursuing option #1 and building nearly fully automated online services at low prices. They make their money on volume. Their client base generally consists of micro and startup businesses. (Those are the clients that want rock-bottom prices and compliance services only)

In a nutshell, the efficiencies of automation free up your capacity, either to take on more clients, or spend more time with premium level clients in a more consultative role. Either option also opens the door to specializing your practice so you can become the go-to-bookkeeping service for a specific industry. That is a powerful advantage over your competition.

A focused, streamlined practice allows you to make it a pleasure for your clients to work with you and your firm. That in turn makes it more likely they will stick with you, instead of chasing lower prices. Why? Because you make it easy for them to get what they want in a streamlined and convenient way. It’s a win-win proposition.

How to Use Automation to Improve Client Experience

A great way to begin to harness the power of automation is in your onboarding process. Especially if you work as a virtual bookkeeper, making it easy for a client to start working with you is key. In the beginning, they need to feel like they’ve made the right choice. To do that, it’s important that once they’ve said “yes” they can quickly and easily sign off on your engagement letter and give you the initial retainer payment to get started quickly.

One easy way to put this type of streamlined workflow together is to take advantage of the integration between SmartVault and DocuSign. With this combination you can immediately provide your client with the electronic version of your engagement letter and payment authorization documents for electronic signature in a secure and convenient way. Within seconds, your client will have signed up and paid you. Quick and simple.

If you’d like to get a personal demonstration on how this works, you can schedule an appointment here.

What To Do Next

Start with considering the experience your clients have working with you. Think through how you could make your services as valuable as possible to them. Make it EASY for them to get what they want and see you as a trusted partner for their success. Then harness automation to do the grunt work to free up your time to do more of what you love doing, and grow both your revenue and profits as a result.