Home Forums Money matters Is churn a problem for tax accountants?

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  • #1000044
    redialpause
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    I’m wondering if retaining clients is an issue for tax accountants? Or do clients tend to be pretty loyal in this space. I’m not a tax accountant so I don’t know the answer. I tend to use the same tax accountant each year – but that’s a sample size of 1. If anyone has an opinion on this question I’d be very interested.

    #1222467
    JamesMillar
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    redialpause, post: 268790, member: 101110 wrote:
    I’m wondering if retaining clients is an issue for tax accountants? Or do clients tend to be pretty loyal in this space. I’m not a tax accountant so I don’t know the answer. I tend to use the same tax accountant each year – but that’s a sample size of 1. If anyone has an opinion on this question I’d be very interested.

    Hi There. My experience is

    1. If you are a tax factory punching out tax returns like widgets at the lowest cost possible – yes.

    2. If you are a firm that delivers A Grade financial problem solving – no churn does not occur. The only thing that causes churn in our firm is when someone either sells a business or closes a business.

    An alternative question to ask is “what causes churn?”

    Now a question for you. Do you ask as a typical small business consuming accounting services or do you ask as a small business selling solutions to accountants that might solve a potential problem? No judgment either way just curious.

    #1222468
    redialpause
    Member
    • Total posts: 9

    Hi James, Thanks for your answer – it’s much appreciated. My reason for asking is that I released a tax receipts app on Google Play – and it’s going OK so far. 1,000+ downloads in under 2 months – with good retention. I have other plans for the app, but it occurred to me that that it might be of interest to an accounting firm with a churn problem. Based on your answer, however, this idea probably isn’t worth pursuing. As I say, it was just a thought. My app is here in case you’re interested:

    https://play.google.com/store/apps/details?id=com.valurian.receipts

    Thanks again for your insights.

    #1222469
    JamesMillar
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    redialpause, post: 268794, member: 101110 wrote:
    Hi James, Thanks for your answer – it’s much appreciated. My reason for asking is that I released a tax receipts app on Google Play – and it’s going OK so far. 1,000+ downloads in under 2 months – with good retention. I have other plans for the app, but it occurred to me that that it might be of interest to an accounting firm with a churn problem. Based on your answer, however, this idea probably isn’t worth pursuing. As I say, it was just a thought. My app is here in case you’re interested:

    https://play.google.com/store/apps/details?id=com.valurian.receipts

    Thanks again for your insights.

    biggest problems I would imagine are

    1. What is your revenue model for this? There are a range of products that offer the same or similar feature that are free or included within the platform subscription that people are always paying. Does yours do something that hubdoc or receipt bank doesn’t do? Then there are trusted free platforms like google drive, Dropbox and box net, OneDrive to name a few.

    2. From what I could tell your platform is free. Might be mistaken. If it’s free how are you measuring retention?

    3. The bigger issue I see with these platforms is that small business owners tend to give up on them after a few weeks / months. This is a problem even with the full featured platforms like receipt bank.

    With Open Banking beginning here this year I think we will see big changes in source document management. In the not distant future (within 5 years) I could foresee people having far fewer / zero printed receipts to deal with. So the value is in AI OCR integrated with platforms like Xero.

    If you have amazing OCR AI that solves other time consuming problems then go for it. Otherwise I would be looking at changing the model.

    My two cents

    #1222470
    redialpause
    Member
    • Total posts: 9

    Thanks again.

    My users are individuals who want a simple app – not a fully featured system. An example persona would be a teacher with an investment property. It’s a simple tool for a simple job. I’m definitely not targeting businesses with more sophisticated requirements.

    The app saves receipts and other data to the user’s Google Drive account – and it prepares exports that the user can send to his/her accountant. It saves a lot of time for people who would otherwise keep their receipts in a box and compile them manually at tax time.

    You’re definitely right about people giving up on these kinds of things. Most apps get uninstalled within a few weeks – and most people only use a handful of apps on a regular basis. As a result, there are millions of apps that go nowhere. I’m well aware ;-) Dealing with this phenomenon is part of the experiment.

    I don’t want to get too much into my business model, but the app is free (there’s no paid version) and there are no ads. I can nevertheless track stats such as retention (and much more) through Google’s Firebase. I can’t see any personal information of course.

    It’s interesting that you mention OCR. My PhD is in AI, and my company specialises in that. I don’t plan to add any AI at this stage however – although I have a neat way of doing it that I might implement down the track. At this stage I just want to see how many retained users I can accumulate based on the MVP.

    #1222471
    JamesMillar
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    • Total posts: 1,675
    redialpause, post: 268802, member: 101110 wrote:
    Thanks again.

    My users are individuals who want a simple app – not a fully featured system. An example persona would be a teacher with an investment property. It’s a simple tool for a simple job. I’m definitely not targeting businesses with more sophisticated requirements.

    The app saves receipts and other data to the user’s Google Drive account – and it prepares exports that the user can send to his/her accountant. It saves a lot of time for people who would otherwise keep their receipts in a box and compile them manually at tax time.

    You’re definitely right about people giving up on these kinds of things. Most apps get uninstalled within a few weeks – and most people only use a handful of apps on a regular basis. As a result, there are millions of apps that go nowhere. I’m well aware ;-) Dealing with this phenomenon is part of the experiment.

    I don’t want to get too much into my business model, but the app is free (there’s no paid version) and there are no ads. I can nevertheless track stats such as retention (and much more) through Google’s Firebase. I can’t see any personal information of course.

    It’s interesting that you mention OCR. My PhD is in AI, and my company specialises in that. I don’t plan to add any AI at this stage however – although I have a neat way of doing it that I might implement down the track. At this stage I just want to see how many retained users I can accumulate based on the MVP.

    That’s an interesting space you operate in. I’d love to chat at some point as we are constantly thinking of potential use and development of our own tech to solve challenges that exist in our space. The best tech solutions tend to be those that are crafted by people familiar with the problems.

    #1222472
    redialpause
    Member
    • Total posts: 9

    A chat at some stage sounds good. I’d be interested to hear about what you’re doing. (Ph: 0404270424)

    #1222473
    bb1
    Participant
    • Total posts: 4,472
    redialpause, post: 268802, member: 101110 wrote:
    You’re definitely right about people giving up on these kinds of things. Most apps get uninstalled within a few weeks – and most people only use a handful of apps on a regular basis. As a result, there are millions of apps that go nowhere. I’m well aware ;-) Dealing with this phenomenon is part of the experiment.

    Is it really a phenomenon or is it just a fact that us consumers download the app best on promises made, the hype is always better then the facts. We try them out, find they are half baked or don’t meet our needs, so delete. Thats not really a phenomenon thats just a bad app.

    What I have found and in particular when apps get mentioned on here, the developer had a late night brain fade, and thought of a great app, developed it the way they wanted it, then went and tried to put it out and found the user (thats us), didnt want it. People have forgotten what user requirements are, a big failing of the app world, and it is more a phenomenon about the developers skills (everyone is a developer) rather then the users.

    Not saying that is the case with your app, I’m sure you did good market research.

    #1222474
    JamesMillar
    Participant
    • Total posts: 1,675
    bb1, post: 268809, member: 53375 wrote:
    Is it really a phenomenon or is it just a fact that us consumers download the app best on promises made, the hype is always better then the facts. We try them out, find they are half baked or don’t meet our needs, so delete. Thats not really a phenomenon thats just a bad app.

    What I have found and in particular when apps get mentioned on here, the developer had a late night brain fade, and thought of a great app, developed it the way they wanted it, then went and tried to put it out and found the user (thats us), didnt want it. People have forgotten what user requirements are, a big failing of the app world, and it is more a phenomenon about the developers skills (everyone is a developer) rather then the users.

    Not saying that is the case with your app, I’m sure you did good market research.

    I think that does happen from time to time Bert but most of the time I think the apps work as advertised. The problem with financial and management apps is the same problem we see with business software decisions.

    When selecting software solutions (in general) many people fail to step back and determine exactly what problem the software is solving and how well it can solve it. People get very excited about To Do apps and Project Management software but the shine wears off when they realise how much work is involved in maintaining those platforms. They only think initially about the great outcome (documents in the cloud) but they dont stop and think – oh ok yeah I still have to do this and do that for it to work. .

    We test a lot of fintech software in our practice all the time. We are constantly looking for improvements and efficiencies to eliminate human input and error. Most platforms fail to meet our requirements because they don’t actually improve things enough to justify the change.

    The big changes will come with AI and automation. We in advanced trials of FYI docs which is a Xero integrated platform for accountants. It has some pretty impressive automation which may be a game changer in terms of internal quality controls.Even with as few as 10 staff – as soon as you allow humans to enter a process orientated function then the quality drops. Even if its 1 in 100 emails are filed incorrectly or 1 in 100 letters have the wrong data – computers can always do it better.

    It might sound cliched but a 1 in 100 error rate is not really acceptable if technology exists to make it 0 in 100. I believe businesses should be aiming for that standard so we have to walk to the talk to back that up.

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