The firm’s £40m investment in its enterprise scheme, including the development of cloud-based software, will allow it to grow its share of the small and start-up business sector, Ian Moffat, KPMG’s head of enterprise, told the Business Development Leaders Network.
The investment, the firm’s biggest injection of cash into the mid-tier market for 30 years, will allow the Big Four firm to compete with high street accountants on price for the first time, in an attempt to push its lower-middle market share from around 10% to 25%, he said.
“We’ll do that by saying to small businesses, ‘You can pay us the same as your current accountant but we’ll give you more.’”
The decision, he said, was driven by the firm’s desire to face off competition from outside the traditional Big Four. Instead turning to the potential threat of big data and tech companies like Google moving into the accountancy market, appealing to young start-ups and smaller companies.
He said, “Obviously, we thought about firms like PwC and EY. But then we paused and asked ourselves, is that really our competition? In the next five years, are big accountancy firms going to be our competition, or is it actually going to be Google, or Amazon, or somebody else?”
The accountancy profession, he said, is “all about data”, and Google is “fundamentally a data company”, he said.
“What’s stopping Google becoming a provider of advice based on data analysis in the future?”
KPMG's decision has been met with interest from across the sector. MD of cheapaccounting.co.uk Elaine Clark said, "It's fantastic that one of the big players has woken up and said 'cloud accounting is here'."
But Clark cast doubt over the assertion that KPMG's service could offer more to small businesses than existing high street accountants. "I'm confused as to the space their operating in. I'm not sure what more can be done."