How Accounting Firms Stay Profitable and Relevant in a Changing World
Thank you to my friends at Melio for sharing this article with us!
Chasing the next big disruption in accounting is a losing game. The future is uncertain, and the pace of change is relentless. Whether it's AI, blockchain, or new ESG mandates, focusing on what's next is less important than building a firm that thrives no matter what.
Here's how forward-thinking firms are doing just that.
Diversify your revenue before you need to
Relying on a handful of services, especially tax prep and compliance, puts your firm on shaky ground. Automation is eating away at routine work, and clients expect more than just a once-a-year transaction.
The reality check: If most of your revenue comes from services that could be automated tomorrow, it's time to rethink your business model.
Start with what you already know
The answer isn't to abandon what you do well, but to layer in new, higher-value offerings around your core services:
For existing tax clients:
Cash flow planning and forecasting
Quarterly business strategy sessions
Strategic tax planning (not just prep)
Entity structure optimization reviews
For bookkeeping clients:
Monthly financial analysis and insights
KPI dashboards and performance tracking
Budgeting and variance analysis
Process improvement consulting
There's something to be said for the fact that your current clients already trust you, understand your value, and have established payment patterns. They're often your most profitable growth opportunity.
Don't overhaul your entire practice overnight. Pick 3-5 ideal clients and pilot one new advisory service. Measure both client satisfaction and profitability. Use what you learn to refine your approach before rolling it out firm-wide.
Make revenue predictable (and clients stickier)
The traditional accounting calendar is a rollercoaster, and sometimes an emotional one. Intense bursts of work and revenue, followed by long lulls. This model strains your team, your cash flow, and frankly, your sanity.
Monthly retainers are the antidote
By shifting clients to ongoing, year-round advisory packages, you:
Stabilize income and improve cash flow forecasting
Build stronger relationships through regular touchpoints
Reduce the feast-or-famine cycle that burns out teams
Create opportunities for proactive guidance, not reactive problem-solving
Real example: Instead of charging $2,000 for an annual tax return, structure it as $200/month for year-round tax planning, quarterly reviews, and preparation. Same revenue, better experience for everyone.
Making the transition
For existing clients: Frame it as an upgrade, not a price increase. "We're moving to a model where we can give you ongoing support throughout the year, rather than waiting until tax season to address issues."
For new clients: Lead with the retainer model from day one. It's easier to start with the right expectations than to change them later.
Price it right: Base your monthly fee on the annual value you provide, then add 15-20% for the improved service level and predictability.
Get hyped about tech, but don't get lost in the hype
Most firms have AI handling data entry and basic automation. The competitive advantage now comes from the less obvious applications: client communication that adapts tone and complexity to each recipient, scenario planning that pulls real market data into forecasts, and practice management that identifies which clients are ready for advisory upsells.
Where the real opportunities lie:
Client insights: AI that analyzes communication patterns to flag satisfaction issues or expansion opportunities before they become obvious
Custom workflow automation: Building firm-specific tools that handle your unique processes, not just generic accounting tasks
Strategic analysis: Tools that can synthesize multiple data sources to spot trends your competitors miss
Building vs. buying: Some firms are moving beyond off-the-shelf solutions entirely. With platforms like Zapier, Microsoft Power Platform, or even custom development, the barrier to creating your own AI-powered workflows has dropped dramatically. A firm might build a custom client onboarding system that automatically generates personalized service packages based on business type, size, and stated goals.
The integration advantage: The real power comes when AI tools talk to each other. Your CRM identifies a client ready for advisory services, your practice management system automatically schedules the conversation, and your proposal tool generates a customized package - all without manual handoffs.
A note on blockchain and emerging tech: watch, don't rush
Blockchain is starting to impact audit and assurance by offering transparent, tamper-proof records. Quantum computing promises to revolutionize data processing. But these are still early-stage technologies.
The smart approach: Stay informed, attend demos, but don't be the guinea pig. Let the early adopters work out the bugs while you focus on mastering the tools that are proven and reliable today.
Rethink talent and build for agility
The talent crunch in accounting is real and not going away. The Bureau of Labor Statistics projects a 4% decline in accounting jobs through 2032, while demand for advisory services continues to grow. The math doesn't work unless we change our approach.
Hire for ‘new’ skills, not just credentials
Progressive firms are expanding their talent pool by looking beyond traditional accounting backgrounds:
Data analysts who can work with financial data and learn accounting principles
Business consultants who understand client needs and can be trained on technical requirements
Industry specialists who bring deep sector knowledge and can pick up accounting fundamentals
Technology specialists who can bridge the gap between systems and business needs
Cross-train your team to avoid single points of failure. If only one person knows how to handle payroll processing or tax extensions, you're vulnerable.
Create T-shaped professionals: Deep expertise in one area, broad competency across multiple functions. This gives you flexibility during busy seasons and career development paths for your team.
Make the most of the remote opportunity
Expand your talent pool beyond your local area. A skilled bookkeeper in Iowa might be perfect for your firm in California and cost significantly less than local talent while delivering the same quality.
Make it work: Invest in onboarding, communication protocols, and management training for remote teams. The firms that master this have a massive competitive advantage. Read our article on Managing Remote Accounting Teams Effectively (in a return-to-office world).
Turn regulatory change into opportunity
Most firms see new regulations as a headache. The smart ones see them as a chance to add value and differentiate themselves.
Recent examples in action
ESG reporting requirements: Instead of treating this as compliance busy work, firms are positioning themselves as sustainability advisors, helping clients understand the business implications of their environmental impact. If you’re trying to keep up with which ESG reporting regulations apply to your clients and what the deadlines are, here’s a great guide from CSO Futures covering worldwide requirements.
State tax complexity: Rather than just filing returns, firms are providing strategic guidance on multi-state operations, nexus planning, and tax optimization.
Data privacy regulations: Forward-thinking firms are becoming trusted advisors on financial data security, helping clients understand how regulations like GDPR or state privacy laws affect their financial operations, designing secure data collection processes, and creating policies for handling sensitive customer information.
When new regulations emerge, ask three questions:
What expertise will clients need that they don't currently have?
How can we position ourselves as the go-to resource for this guidance?
What premium can we charge for specialized knowledge and proactive support?
Every regulatory change is a chance to deepen relationships, command higher fees, and distance yourself from competitors who see only compliance obligations.
The future of accounting is flexibility
The firms that will thrive five years from now aren't the ones with the flashiest technology or the biggest client lists. They're the ones that have systematically built flexibility into every aspect of their business.
They've diversified their revenue beyond compliance work, not because they read it in an article, but because they tested it with real clients and saw the results. They've embraced predictable monthly revenue because they've lived through the stress of feast-or-famine cycles. They've invested in technology that actually solves problems, not just the latest trend.
When the next disruption hits (and it will) these firms won't scramble to react. They'll already be positioned to turn change into opportunity.
That's the difference between surviving in accounting and truly succeeding in it.
