Everyone is buying accounting firms right now. But how will they actually make them more efficient?
Marit Wetterhus
Chief Executive Officer
We see accounting firms being acquired more and more often, by chains, by investment houses, by players who see predictable revenue and a loyal client base. It is not hard to understand why the sector is attractive to own: recurring revenue, high client retention, and still a great many small firms that can be merged.
The question is not who is buying
The interesting question is not who is buying. It is what happens next.
What it actually takes to realise the value
To genuinely realise the value in a consolidation of this kind, without wearing out the people already working in those firms, something more is required than simply more units under the same umbrella:
- More advisory work, less routine processing
- Faster processes, without adding more hands to the operation
- Reporting across systems, companies and sole traders
- Key figures that are up to date when you need them, not only once the accounts are closed next quarter
Without this, a wave of acquisitions quickly becomes nothing more than a larger version of the same problem: many firms, many systems, and still nobody with the full picture.
That is precisely what consolidation across companies and systems is meant to solve. Not because it is nice to have, but because it is the precondition for a merger delivering more than just a bigger name above the door.
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