$45.3 billion boost for small business as reliance on financial advisors rises

One year on from the start of the COVID-19 lock down, small business leaders are estimated to have derived $45.3bn in value from their relationships with their accountants. More than half (51%) increasing their reliance on their advisors to help manage the impact of the pandemic.

Newly-released QuickBooks Advocating for Advisors research estimates that $36.4 billion flowed into the sector through access to business grants, investment guidance or from other financial advice provided by advisors.

This was complemented by savings estimated to amount to $8.9 billion from advisors’ recommendation of more cost-efficient financial products, guidance on debt consolidation, budgeting, retirement planning and taxes.

The top findings include: 

  • Small business leaders are estimated to have derived $45.3bn in value (savings and profits) from their relationships with their accountants and bookkeepers (advisors) in the last year
  • More than half of these leaders (51%) increased their reliance on their advisors to help manage the impact of the pandemic
  • Two thirds (67%) were able to retain their staff with the advice from their advisors
  • Half (50%) of small business leaders used their advisor for ‘emotional support’ during the pandemic 
  • While close to six in ten (57%) admitted they would have struggled to keep going without the support of their advisor over the course of the pandemic
  • Cumulatively, advisors have saved small businesses, on average, 16,615 hours per month in the past year

More than just money saved

In a major boost for pandemic employment levels, two thirds (67%) of small business leaders also reported that advice from their advisors helped them to retain staff. Yet reliance on advisors extended far beyond the financial.

As many as half (50%) of small business leaders saying they also turned to their accountant, bookkeeper or financial advisor for emotional support during the pandemic.

Aside from financial and emotional support, the research shows advisors gave something else equally as precious to their clients: TIME.

More than two thirds of small businesses said their advisor had helped to save them an average of 20 hours per month, a cumulative 16,000 hours-plus saved for the sector.

This saved time, which averaged out to more than a full working day per business (8.9 hours), allowed small business leaders to focus on things that really matter.

Simplifying tax time preparation

Looking ahead, small businesses with an advisor relationship are now three times more likely to feel positive about the upcoming end of financial year and tax preparation period. 

Meagan Wood, Head of Advisor Strategy at Intuit QuickBooks Australia, said, “Our internal research shows us that there are three reasons why SMBs don’t connect to an advisor.”

“They don’t think their business is big enough to warrant it, they don’t want to pay for on-going access to an accountant or book keeper and they’re not sure where to find one.”

“It’s the perfect time leading into tax season for small business owners to reconsider their current situation and seek out the guidance they might need so they can spend more time working on their business and less time worrying about their financials.”

Richard Spencer, Chief Customer Experience Officer at Business Australia, added his support to the role advisors have played in helping small business leaders become more financially and emotionally resilient during a tumultuous period.

“Without a doubt, the last 12 months have been tough for many small businesses and their employees and we are very appreciative of the efforts by the advisor community to guide and uplift their small businesses clients.”

“Like Business Australia, advisors continue to demonstrate just how committed they are to supporting our local business communities to rebuild and thrive.”

“Also demonstrated is the importance of building strong teams behind them and seeking outside support, counsel and advice as we head into the end of financial year,” Spencer said.