New Sage research shows two-fifths (39%) of SMBs name Making Tax Digital as the number one reason they sought accountancy services
Sage (FTSE: SGE), the leader in accounting, financial, HR and payroll technology for small and mid-sized businesses, today shared new research that showed accountants are the UK’s number one go-to business service.
The ‘Count on Accountants’ research gauged the mood of accountants and SMBs in the UK and found accountants underestimate the positive impact they have on the business community. Nearly two-thirds (64%) of accountants believe SMBs underestimate their value. However, perception lags reality with 91% of small businesses rating accountants as an important part of their business’ operation and half (49%) of SMBs go to their accountant for strategic business guidance.
Named by small and mid-sized businesses as ‘critical’, the new study discovered a staggering 92% of SMBs use the service of an accountant, with half (49%) using their services at least weekly. When asked what services they would go to when first starting out a business, SMBs named accountants as the number one (34%) ‘go to service’.
The number one source of advice
The research stressed the importance of accountants to SMBs in response to the changing world. The greatest driver of businesses relying on accountants is ‘Making Tax Digital’ legislation. Two-fifths (39%) of SMB respondents named this as the reason they had sought out accountancy services. Over a quarter (28%) said COVID-19 had driven them to seek out the help of an accountant and a fifth (18%) named Brexit as the driving factor. In fact, during the pandemic, over half increased their reliance on accountants.
The research found an accountant is the most consulted source of advice for strategic business decisions with half (49%) of SMBs saying they would go to them for critical guidance. This is compared to just a quarter (26%) who turn to business support networks (such as a local Chamber of Commerce), or just 15% of SMBs who turn to friends for guidance. Thinking about any significant disruptions to their business, two-fifths (40%) seek advice from an accountant. In contrast, only a third (32%) would seek advice from peers and business support networks.
Paul Struthers, MD, UK and Ireland, Sage, said: “Sage’s focus is to knock down barriers to help the UK’s SMBs thrive by giving them access to technology that provides them with a competitive edge. Accountants play a critical role in accelerating this success and our research shows they are vital to the UK’s economic recovery.
“Our research shows accountants have an open door to become a de-facto strategic partner for their clients – this is an opportunity they must embrace.”
Lydia Read-Potter, Director, Book Smart Accounting, said: “As an accountant, this research is compelling and assurance that the nation’s businesses stand by our side and appreciate how we can fuel their business dreams.
“With half of small businesses now using accountants for strategic business advice, it represents a turning point in the profession. We have a real opportunity to become a seamless part of our client’s business: operating as a key member of their team and helping them drive better decision making to aid their growth.”
Ryan Panchoo, Owner, Borough 22, said: “When I first opened for business, I had two Excel spreadsheets – one showing money in and one showing money out. Pretty basic but at that time that was all I could focus on. I soon realised how critical a good accountant was and appointed one. Not only to support with my day to day, monthly, quarterly cashflow needs but more importantly someone to advise me on business strategy and help guide me in areas where I am not the expert.
“It’s no surprise that 91% of small businesses say accountants are an instrumental part of their business. My own business has grown since I started it several years ago, I just wish I’d started that journey with an accountant by my side as it would have been a smoother and quicker journey.”
Sage has created a free guide for small businesses called ‘Why you need an accountant in a digital world’ which can be downloaded here.