Planners and accountants up profits from referrals
Majority of financial services companies and accounting practices (94 per cent) had increased their net profits year of year, mainly from client referrals, according to Macquarie Bank.
The bank's survey of 355 small to mid-tier financial services and accounting practices around Australia found they had generated an average $2.51 million in revenue, while their average profit increased to $809,859.
Macquarie's inaugural 2015-2016 Account and Financial Services (AFS) Benchmarking Report also highlighted that an "overwhelming 91 per cent of firms said greater client referrals and improved income per client, were the main revenue drivers for their business."
Meanwhile, Macquarie wealth management, division director, David Clatworthy said 79 per cent of high profit firms improved profitability by added value to existing clients.
He said "investing in quality staff" was also essential to building a stronger client value proposition and relationship.
Almost half of respondents (44 per cent) said retaining key quality staff was an important strategy in driving profitability, said Clatworthy.
Looking to the future, 83 per cent of companies said they were confident about their business prospects, according to the study.
Over the next 12 months, all businesses said they would focus on attracting new, ideal clients, said Clatworthy.
But, smaller firms said they were focused on regulation changes, and were three times more likely to be affected by change in this space, he added.
Meanwhile, 41 per cent of larger firms said integrating technology was a challenge and that they would look to better use it to boost efficiency, attract and retain staff, he said.
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