When COVID-19 hit in March 2020, many regional accounting practices struggled with the sudden shift to remote work. However, one Ballarat practice turned this challenge into an opportunity that ultimately doubled their practice value and expanded their market reach across Victoria.
This case study reveals how embracing digital transformation can solve the persistent challenges facing regional accounting practices across Australia.
The Regional Challenge
David and Helen Thompson* had operated their Ballarat accounting practice for 15 years, serving local small businesses and individual clients. Like many regional practices, they faced ongoing challenges:
- Limited local market for growth
- Difficulty attracting and retaining skilled staff
- Competition from larger metropolitan firms
- Clients increasingly expecting digital services
- Rising overhead costs with static fee growth
Pre-pandemic, the practice generated $420,000 in annual fees but profitability was declining. Staff turnover was high, with qualified accountants leaving for opportunities in Melbourne. The practice was heavily paper-based, requiring clients to visit the office for meetings and document exchange.
The Transformation Strategy
Rather than viewing COVID-19 restrictions as a threat, the Thompsons saw an opportunity to fundamentally reimagine their practice model. Working with SMF’s practice development team, they implemented a comprehensive digital transformation.
Technology Infrastructure The practice migrated to cloud-based systems within six weeks, including:
- Xero Practice Manager for job management
- Hubdoc for document collection
- Zoom for client meetings
- Secure client portals for document sharing
Staff were provided with laptops and home office setups, creating a flexible work environment that proved attractive to skilled professionals.
Service Delivery Revolution The new digital platform enabled the practice to serve clients across regional Victoria and beyond. Meeting clients virtually removed geographic constraints whilst improving efficiency.
Document collection became automated through Hubdoc, reducing manual data entry and improving accuracy. Clients appreciated the convenience of uploading documents securely from their own offices.
Market Expansion With geographic limitations removed, the practice began targeting niche markets where they could add significant value:
- Manufacturing businesses across regional Victoria
- Agricultural enterprises statewide
- Professional services firms in smaller regional centres
This specialisation allowed for premium pricing and stronger client relationships based on industry expertise rather than just location.
The Results
The transformation delivered remarkable results within 18 months:
Financial Performance
- Annual fees increased from $420,000 to $780,000
- Profit margins improved from 22% to 35%
- Average fee per client rose 40%
- Client retention improved to 98%
Operational Efficiency
- Document processing time reduced by 60%
- Staff productivity increased 45%
- Office overhead costs decreased 30%
- Client satisfaction scores improved significantly
Strategic Value
- Practice valuation increased from $450,000 to $950,000
- Attracted interest from multiple potential buyers
- Created a sustainable competitive advantage
- Established platform for continued growth
Staff and Client Benefits The transformation benefited all stakeholders:
Staff Advantages
- Flexible work arrangements improved work-life balance
- Reduced commute times and costs
- Access to more interesting and challenging work
- Professional development opportunities through specialisation
Client Benefits
- Faster response times and service delivery
- Reduced need for office visits
- Access to specialist expertise regardless of location
- Improved communication through digital platforms
Key Implementation Lessons
Several factors were critical to the transformation’s success:
Leadership Commitment: David and Helen fully embraced the change, investing in training and supporting staff throughout the transition.
Staff Engagement: Regular communication and training ensured staff felt supported rather than threatened by the changes.
Client Communication: Proactive communication helped clients understand the benefits and adapt to new processes.
Gradual Implementation: Changes were introduced systematically, allowing time for adaptation and refinement.
How SMF Supported the Transformation
SMF’s role extended beyond traditional brokerage to include strategic advisory services:
- Technology platform recommendations
- Change management guidance
- Market positioning advice
- Financial planning for the transformation
- Ongoing performance monitoring
Broader Implications for Regional Practices
This case demonstrates that regional practices can compete effectively with metropolitan firms through strategic use of technology. The key is viewing digital transformation as an opportunity rather than a threat.
Regional practices have unique advantages including:
- Lower overhead costs
- Stronger community connections
- More personalised service
- Niche market expertise
Combined with digital capabilities, these advantages can create formidable competitive positions.
How SMF Can Help Your Practice
At Sell My Firm, we understand the unique challenges facing regional practices. Our practice development services help identify opportunities for growth and value enhancement through strategic transformation.
Whether you’re planning to sell or simply want to build a more valuable and efficient practice, we can help you navigate the digital transformation journey.
*Names have been changed to protect client confidentiality.