Competition over fees is the biggest risk to profitability for accountancy firms
Almost a third (29%) of accountants see this as the greatest threat, while pressure to reduce fees (21%) and late payments (26%) remain major concerns, according to a new survey by Bloomsbury Professional.
Martin Casimir, managing director at Bloomsbury Professional said “getting money in the door from clients” is the main worry as increased pressure and a tough financial climate from clients will keep fees low.
He also believes larger firms “aren’t immune from the pressure on fee income either, as merger and acquisition work or other forms of corporate finance work are scarce at the moment.”
The survey warned that an increasing number of failing accountancy firms could hurt the UK’s small businesses.
“Small businesses benefit from the presence of variety and competition in the accountancy sector. They rely on access to smaller, affordable accountancy firms with whom they can have a very close relationship,” added Casimir.
It also revealed that a stagnant job market has enabled firms to keep costs down as 93% said staff poaching was not a risk to profitability and 77% were unconcerned about the effects of pay rises.
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