Accounting services marketingIntroductionHaving worked in various positions in the accounting service industry for the last eight years, I have acquired a wealth of experience which is sufficient for me to start an accounting services firm. I have noted that most firms in the industry are only offering high end services to their clients while ignoring the lower end market services such as book keeping and tax compliance. They cite low demand and fewer returns as the reasons for failure to offer such services. However, with the increasing regulations and government’s increased emphasis on tax compliance as well as increased tax requirements, the demand for such lower end services will be in the increase.
As such, there is a lucrative opportunity for me to start a firm offering the lower end services to my clients. The proposed name of the firm is Prince House and associates and will mainly serve the small businesses segment of the market. This paper is a detailed market plan for the firm and the services it is intended to offer. Industry descriptionThe Australian accounting services industry is a significant one and had revenue of $15.3 billion in 2012 and is expected to increase by 5.6% annually to $18.9 billion in 2015-16.
The industry is composed of firms certified to audit accounting records of private and public organisations while attesting their compliance with professional standards (Miriam, 2011). The firms provide a variety of accounting services which range from auditing of accounting records, book keeping and preparation of financial statements, designing of accounting systems, budget and financing advice among others. However, it is worth noting that most of these firms nowadays prefer to provide auditing, superannuation, financial planning and ICT services while book keeping and tax compliance is largely ignored (Joseph, 2007). Why an opportunity for business existsAs stated above, most firms ignore book keeping and tax compliance services are they are deemed to be less rewarding.
However, there has been increased regulation especially after the global financial crisis requiring that companies adhere to IFRS and other standards provisions in preparing their financial records. This means that there will be increased demand for book keeping services as companies strive to ensure compliance with the new reporting requirements (Francis, 2005).
In addition, new taxation requirements such as carbon tax requirements as well as the heavy penalties imposed on tax evasion will force companies to increasingly seek for tax compliance services. This informed my decision to form a firm that will specialize on book keeping and tax compliance services (Christopher, 2004). Furthermore, there is not much competition in this sector which only had revenue of $2.6 billion in 2013 hence implying a great room for growth. The key external drivers for the industry include; Numbers of businesses- New businesses continue to be formed at an increasing rate thus providing an ongoing free revenue sources for the industry. Policy and legislation for accounting services – there have been numerous changes to tax and other legislation that have greatly boosted the demand for accountancy services.
This includes the GST introduction as well as a variety of business tax changes especially in early 2000s which had the largest single boost to the demand in accounting services (Christopher, 2004). Persistent outsourcing of accounting services –increasing outsourcing of accountancy services both by the government and businesses have greatly boosted demand for the industry.
Real GDP growth – increased economic activity usually boost demand for accountancy services in areas such as IPOs, acquisitions and mergers, takeovers, financing deals etc. when there is economic decline, bankruptcy and liquidations increase. Competition from legal services –merged legal and accountancy services continue to increase competition in the industry.