1. The Economics of a Cloud Based Practice
Marty French, Intuit Accountant Segment Business Development Leader @ThatIsBillable
11/15/17
#QBConnect | WiFi: QBConnect Password not required

2. Connect time. Ask your neighbor…
If he or she had a 12 month strategic business plan that would improve profitability by 40% on 25% of the firm’s business clients, what is the number one challenge that would stand in the way of successful implementation?

3. Challenges in Today’s Large Firms
Staffing – Retention & New
Generational Challenges
Advisory?
Scaling Growth
Mindset of Leaders
Production Expectations
Staffing – Retention of Top Staff, finding the right new staff
Generational Challenges – Old way vs New, Significant changes in leadership in process or around the corner, funding Partner retirement
Advisory focused on Compliance, tax savings, individual financial planning
Scaling Growth - Book Of Business vs Whole Firm Business
Mindset of Leaders - Accounting as Low Value Work
Production Expectation - Utilization & Realization

4. Today’s speaker Marty French
Intuit Accountant Segment Business Development
@ThatIsBillable
12 Years at Intuit
32 in Technology Consulting Sales
Certified QuickBooks Pro Advisor
12 Years at Intuit
32 in Technology Consulting
Certified QuickBooks Pro Advisor

5. CPE In order to receive CPE credit CPE Process Credit
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6. Agenda The Economic Journey The Economic Opportunity The Economic Team
The Economic Solution

7. Economics –
a social science concerned chiefly with description and analysis of the production, distribution, and consumption of goods and services

8. The Historically, Technology Drives Economic Boom
2017
1985
1999
2012
2013
Computers, MS Office, Tax & Accounting Software
Machines replace Weavers
But quadruples demand for cloth
ATM’s Create Banking Boom
Uber & AirBNB
& the Gig Economy
A surprising discovery of
Realization and Profitability
Outsource Accounting &
XaaS
Ecommerce on the rise
AI is here, Businesses will benefit

9. The Economic Journey to the Cloud
2000
2017
2005 & 2006
2007
2012
2013
Business Owner Focus Groups
Paypal take off and QB Online starts
Hurricanes Katrina & Rita
Hurricane Sandy
New QB Online Platform
Outsource Accounting
XaaS
QB Consultant
QB Accountant Tools
+$1200
Hosting & Cloud based Accounting
AI is here, Business Advisory

10. The Economic Opportunity

11. The Productivity Paradox In an Hourly Based Practice
We all have the same 168 hours in a week
Time is a constraint
In order to make more you need to charge more or hire
Zero Sum or negative in an hourly based practice
Firms average a 30% increase in efficiency using Cloud Technology

12. The Value of Value Based Pricing Pricing for Profitability
Efficiency at a firm level means more clients or more interaction with
current clients or both
Allows the client to focus on the totality of the firm’s value Proposition
Allows your clients to budget their total Accounting spend
Allows you to price the customer not the services
It pre-qualifies the client to ensure they are a good fit for the firm
It improves the communication and collaboration with your clients
Forces the firm to be effective in processes and project management

13. Repricing An Existing Outsourced Bookkeeping Client Currently Bill Rate $100, Staff rate $50
Client on Transaction Billing
Average of 10 Hrs/Mo
Monthly Billing $1000
Monthly Staff Cost $500
Profit = $500
Client on Value Pricing
Monthly Billing $1000
Monthly Staff Cost (5 Hrs) = $250
Monthly Technology Cost = $50
Total Cost = $300
Profit = $700
NOW DOUBLE DOWN = $1400
Automating accounting with cloud based QBO and Apps, makes outsource accounting a via offering for firms. As a result, there will be more demand as outsourcing this work to a trusted accounting advisor becomes the norm.
Realistically, of all your Small business clients, easily 40% would be outsourced accounting clients and the remaining (annual compliance clients) would need your help converting to QBO and training their staff. Your tax accountants now can do monthly or quarterly reviews, spreading the cleanup and adjustments through out the year. Questions on transactions are more easily answered since they are recent to the business owner.

14. Repricing An Existing Compliance Client Annual Business Return $3600
9 Hours of Tax Time Work
4 hours of QB Clean up
Prior Period & Cleanup – 1 hour
Audit hunt – 1 hour
& follow-up – 1 hour
Audit hunt again & final adjustments – 1 hour
1 hour Source Document collection
2 hours Tax return prep
2 hours admin time
4.5 Hours Throughout the Year
3 hours of Monthly Accounting Review
1.5 hour YE Trial Balance & Return Prep
Year Round Client Collaboration
Questions on the transactions in a timely manner
Source Documents are always available
50% reduction in staff time & cost
NOW DOUBLE DOWN = $7200
Automating accounting with cloud based QBO and Apps, makes outsource accounting a via offering for firms. As a result, there will be more demand as outsourcing this work to a trusted accounting advisor becomes the norm.
Realistically, of all your Small business clients, easily 40% would be outsourced accounting clients and the remaining (annual compliance clients) would need your help converting to QBO and training their staff. Your tax accountants now can do monthly or quarterly reviews, spreading the cleanup and adjustments through out the year. Questions on transactions are more easily answered since they are recent to the business owner.

15. The Economic Team

16. Solving for Culture & Staff Success
Elevates Data Entry Staff to Reviewers
Creates a Career Path for non-CPAs
Staff Utilization at 250% in a 8 hour day
Realization is at 300%
More $$$$ for Everyone

17. New Staff & New Roles Do you need a sales team?
Do you need business majors?
Do you need consultants?
Do you need technologist?
Rethink your intern program?
As tax and audit become more automated, Accounting and Advisory Services will be the primary line of business for most of the industry. And, Advisory services will include thinks that don’t even exist today.

18. The Economic Solution

19. Executive Leadership Drives Change

20. Challenges in Today’s Large Firms
Staffing – Retention & New
Generational Challenges
Advisory?
Scaling Growth
Mindset of Leaders
Production Expectations
Looking again at these challenges from the earlier…they all can be solved with the right mindset of executive leaders driving effective change and moving clients to the cloud.

21. Your Clients need and want your guidance to help them make better business decisions.
Only accurate real-time data provides the foundational reporting and insights your staff needs to be Trusted Advisors.
And Realtime means Cloud based Accounting Solutions like QB Online, with r

22. In September, 2017, Forbes Magazine named Perelman as one of the "100 Greatest Living Business Minds."[

23. Plan, Execute & Grow Profitability Fast
Plan, Execute and Grow Profit fast – with a test, then fine tune and expand broader.

24. Questions?