Research conducted in 1994 by Victoria University showed that over 60% of "suburban" Accounting Practices’ time was consumed doing compliance work. The Australian Society of CPA’s estimated that an increase in this workload of 20%-40% was imminent with the advent of GST. VillageMall^® believes small business proprietors rarely physically meet with their accountants. Generally speaking, Accounting is the only profession of the three major professions (i.e. law, medicine and accounting) that does regular ongoing work for their clients. The other two are generally used when a particular need arises.

Due to the current functionality of software systems and traditional (entrenched) industry practices, accountants’ work is normally carried out on a ‘one client at a time’ (professional) basis and charged out to that client at an hourly rate.

In summary, VillageMall^® believes that existing compliance and general accounting processes are inefficient, cumbersome, labour intensive and expensive to manage. In the same manner VillageMall^® has successfully pioneered superior ways of developing and deploying Business Solutions, we have applyed the same principles to the provision of services resulting in VillageMall-Business-Services.

VillageMall^® Business Services retail-clients are charged a fixed monthly fee based upon the  number of transactions recorded for the particular business each month according to pre-determined plans (simular to mobile phone plans). A small fee is also charged each month for each person employed by the small business if clients use the payroll component of the service. A wholesale pricing structure is available to accountants on a similar basis.

The following survey findings are of particular interest:

• for each qualified person (accountant) employed in the practice only 0.8 unqualified persons were employed;

• 56% of all practice overheads were taken up by direct employment costs with a further 2% on labour hire. That is, 58% of all expenses were direct labour costs.

VillageMall^® believes that by utilising the Business Service approach, approximately 15 unqualified persons will be employed for each qualified person employed. This improvement in the qualified/unqualified employment ratio should reduce employment costs within its operation by 20% relative to the average accounting practice. VillageMall^® believes that "throughput" per employee will also be improved by in the vicinity of 30% due to the overall efficiency gains achieved in part from operators being skilled in performing repetitive tasks, through the superior capabilities built into the VillageMall Business Solutions and the ability to balance the workload across time and multiple companies.

Irrespective of the eventual operating profit margin figure, VillageMall^® believes its margin will be greater than that of most current accounting practices due to the greater efficiency gains achieved in its VillageMall^® Business Services model, and use of its own superior VillageMall^® Business Solutions.

Additionally VillageMall^®  offers a single integrated business solution (more than simply accounting) to a wide range of small to medium business with 1 to 250 employees.

VillageMall Business Services Client Advantage
The promotion and selling is largely based on the real value (i.e. benefits less costs) that VillageMall^® can offer the small business, namely:

• Single Business Solution for all clients

• Extend professional services beyond simply accounting

• Potential fee revenue increases through the ability to offer an outsourced bookkeeping and payroll service to existing clientele. There will be greater transparency as clients will actually "see" what the practice is doing for them every single day;

• Greater exposure to client’s business and more control through access to real-time accounts information and all source documentation in electronic format;

• Potential increases in profit per client by value-charging whilst achieving a significant reduction in compliance staff costs and other fixed overheads;

• Accelerated client growth by freeing up and redirecting existing staff resources to:

  • broaden the delivery of other services;

  • acquire new clients (for both compliance and advice work);

  • Greater time availability for partners to spend ‘on’ the practice;

  • Allow for more flexible and cost-effective management of multiple site practices.

• No expensive IT infrastructure, or Software required

• Movement to VillageMall^® Accountants Office.