Great practitioners stay on top of the accounting trends that affect their clients’ businesses. They work to understand emerging pain points before they impact their clients. This is especially important in the SMB market. Changes often happen quickly and it's best to prepare your clients.
The following trends should be on your radar in 2017. They are opportunities for proactive advisors to deliver helpful advice.
Alternative financing options create possibilities and peril
Traditional financing is harder to come by than ever before. Small business loans from traditional lenders have dropped about 20 percent since the financial crisis. In response, a variety of alternative finance options have come into being. Peer-to-peer networks, small business lines of credit and merchant cash advances are increasingly popular. However, they are not regulated like traditional loans. That creates a wide range of payment terms and interest rates. Choosing the right option can be difficult. A mistake may mean making payments a SMB can’t afford or suffering through a term that is too long. Good advisors can help their clients evaluate which choice makes the best business sense.
Flexible costs are on the rise in SMBs
Wage, equipment and real estate costs are rising. Profit margins are narrowing for many SMBs. More than ever SMBs need to be nimble. For many, that means turning fixed expenses into variable costs. Small businesses need flexibility to run lean most of the time. However, they need to be able to put resources in place to meet peak load. For many that means replacing full-time staff with part-time, contract, and freelance people. It also can mean looking to lease equipment and real estate versus buying. Trusted advisors can help SMBs make the right decisions while increasing flexibility.
Local businesses can have global reach because of tech
Ecommerce solutions are now available to businesses of all sizes. The ubiquity of mobile means customers have access to services from anywhere. Digital marketing gives SMBs wider reach than ever before. All of which means even neighbourhood businesses can have global scope. Figuring out how to leverage tech to better serve that large customer pool is a challenge for SMBs. They need help containing costs while capitalizing on the opportunities afforded by new technologies.
Rise of business intelligence creates a monumental shift
New software solutions allow SMBs to aggregate the different data streams available to them. At its best, this business intelligence should enable companies to make better decisions. It can be used to forecast sales, develop top customer profiles, or identify efficiencies. In practice, the volume of information provided can be daunting. Many SMBs look to their partners for help in interpreting the data. They seek an advisor’s expertise in using BI to create the right plan for the future of their business.
Putting it all together
In a changing landscape, the guidance that advisors can provide their clients is more valuable than ever. They will form the closest bonds with the advisors who help them thrive in uncertain times. Solving finance, resourcing, tech, and BI issues will set you up as trusted partner.