As digital disruption is spreading across several industries worldwide, consumer expectations are growing at each stage. The adoption of technologies such as Artificial Intelligence, Internet of Things, Big Data, Blockchain, etc., can help retailers effectively adapt to the continuously changing consumer expectations.
Here are some of the modern customers’ expectations from retailers:
- Personalized Interactions
- Proactive Customer Service
- Excellent Customer Experience
- Data Protection
- Uninterrupted services throughout their journey as a customer
In today’s competitive business environment, digital transformation has become a necessity for retailers, especially for their long-term survival in the market. And it appears they are ready to invest more in the latest technologies and adopt emerging trends in the industry.
In this blog, we will focus on the newest accounting trends that are transforming the retail industry like never before.
Latest Accounting Trends in Retail Industry
1. Artificial Intelligence
Automation is already being used in retail accounting functions like invoicing, which helps accountants ease off their workload. Machine learning, a subset of AI, is taking substantial data sets and recognizing patterns and trends by applying numerous analyses. This process is helping retail accountants to identify financial fluctuations, forecasting, frauds, etc.
Labor-intensive tasks such as payroll, tax preparation, audits, bank reconciliation, etc., are expected to be completely automated by the end of 2020 with the help of AI-powered technologies, as per one research by Forbes.
However, we are far from eliminating the need for humans in accounting; these technologies will always require humans to control them and review the results they provide. All AI and ML do is work as helping hands for accountants, reducing their workload and the turnaround time of accounting processes.
2. Cloud Computing or Cloud Accounting
Cloud solutions for accounting purposes offer many advantages, from getting financial information updated in real-time to cost savings. Cloud is the most commonly used technology in the finance and accounting sector currently, according to the Robert Half research.
The cloud-based accounting systems also quicken the accounting processes, which is essential for working with AI and data analytics. Also, the retail accounting industry is adopting ‘cloud’ to make financial reporting and analytics more comprehensive and fruitful.
3. Social Media
Social media websites such as LinkedIn, Twitter, Facebook, blogging websites, and community forums help businesses communicate with customers. However, such platforms are now increasingly being used by accountants too.
These platforms are being used to remain in touch with industry experts that frequently share posts regarding new accounting trends, laws, strategies, and ideas.
Retail accountants are also stepping into this trend to get more insights into the accounting world to improve their knowledge, skills, and expertise. With the help of such knowledge, retail accountants are transforming the industry like never before.
4. Rise of Accounting Software Solutions
With the growing demand for computer-based accounting, retail companies are adopting accounting software at a rapid pace. The accounting software market is expected to achieve higher growth levels in the coming years, as per one report by Fortune Business Insights.
Here are some of the most popular accounting software tools being used today:
- Quickbooks offers desktop applications for accounting along with cloud-based versions that help with bill generation, payroll management, payment processing, etc. The global accounting software market share for Quickbooks is 62.23%.
- Xero allows accountants to track and edit transactions, process payments, and monitor billing & invoicing. Its market share is 8.86%.
- Sage Business Cloud Accounting combines multiple verticals of accountancy, such as basic accounting, compliance management, and expense management – all in one place. Sage’s market share is 10.29%.
5. Big Data and Analytics
Big Data, in this data-driven world, plays a crucial role across industries. With big data, accounting professionals at retail companies are transforming internal data into highly secure data sets. This also helps them analyze processes and forecast potential accounting issues.
As the data is available in real-time with the help of Big Data, retail accountants are getting helpful insights on time and analyzing financial records quickly and accurately.
6. Accounting Outsourcing
Yes, accounting outsourcing is a rapidly emerging trend across all industries, and many of the adapting businesses are reaping multiple benefits. Outsourced accounting for retailers is becoming popular with time, making it a strategy that gets the work done cost-effectively.
Having an in-house accounting team keeps your expenses high. Apart from monthly salary, the cost you pay your accountants in a retail company comprises of payroll taxes, medical insurance, workers’ compensation, retirement plans, other employee benefits & perks, etc.
Outsourcing saves all these costs as you only pay for the specific accounting work done for your company. Additionally, you take advantage of the flexibility in scaling the service contract as per your business requirements and changes in the customers’ purchasing patterns.
other factors leading to industry transformation
The opportunities to expand the business beyond geographical and political borders are increased and becoming easy to obtain. For retailers, it is no longer difficult to deliver a product from their home country to a consumer in another.
AI is not only helping in accounting but also enhancing the customer experience. Sales-robots in grocery stores and product recommendations on e-commerce websites are possible because of AI, helping retailers to deliver excellent customer service. Apart from that, drone-delivery has already created a hype in the industry, and many retailers are adopting this idea.
As consumers are also increasingly dependent upon technology to carry out many of their daily activities, they expect to have excellent customer experience in both verticals (e-commerce as well as physical retail).
Now what I think is that one of the most significant reasons behind the transformation of the industry is 'consumers', since their shopping behavior, patterns, and expectations are continuously changing.
Coming back to the accounting trends while concluding this piece, I believe that the use of technology in retail was a revolutionary decision. Because of this, retail accountants today are able to efficiently, accurately and quickly perform multiple accounting tasks including preparation of profit & loss statement, balance sheet, cash flow statement, inventory costing, etc. With the increasing adoption of technological trends in retail accounting, the retail industry is gradually becoming future-ready.
About the Author: Briella Jean, works a Business Development Manager at Cogneesol, a well-renowned company offering data management, technology, accounting and legal services. She has been working with Cogneesol for the past 10 years and is responsible for branding and generating sales. While handling the projects, she has witnessed a lot of changes over the years. She has been thoroughly researching and sharing her viewpoints about these industry trends and changes on many platforms across the Internet.