The PBSA (Privately-built student accommodation) sector shows no sign of slowing down. M&As, consolidations, and unabated flow of international students are getting more and more traditional investors interested in PBSA. As a student housing manager, owner or finance leader, outsourcing accounting functions can look like an interesting way of improving efficiency and reducing costs.
As a finance & accounts outsourcing company serving 6 of the leading student housing companies in the UK and US, we have a clear idea of why PBSA companies outsource. Primarily, the aim is to achieve one or more of the below objectives:
- Reduce the cost of finance & accounting functions
- Address the issues related to accounting staff movement, or the difficulty of finding or retaining trained staff
- Free up the finance leaders, senior team members and the site managers from day-to-day accounting activities, and empower them to focus on strategic tasks
- Improve the accuracy, quality and speed of financial reports and management reporting
- Streamline accounting processes, improve efficiency and get support for implementing innovative technology
Benefits that PBSA companies gain via outsourcing finance & accounting functions
Let’s take a closeer look at the key factors that drive student housing companies to invest in an offshore accounting team:
1) Up to 50% reduction in accounting costs
Lower cost of operations are often the primary drivers of outsourcing. Your company can save up to 30-50% on the costs by setting up a team or hiring resources at an offshore location like India, Philippines or Sri Lanka. For a successful outsourcing engagement, it is essential to strike a balance between the cost and quality. The cheapest is unlikely to the best.
2) Improved efficiency through better processes
Outsourcing providers that specialise in F&A functions will have hundreds of accountants with the experience of working with a wide range of software, across industries. They will have best practices in place that percolate to each team and individual. Your business can leverage such providers to streamline their processes and improve efficiency.
3) Compliance taken care of
Accounting departments can end up spending a lot of time on ensuring compliance. An outsourced partner that understands the legislations and regulatory compliances that impact the student housing industry can embed the relevant compliance processes within the function. For example, the services provider can ensure compliance with the TDP scheme and even offer advice on the effective use of deposited funds.
4) Impress investors or owners
Investors always want reports to check the status of their student housing portfolio. Student housing managers that are able to deliver insightful and accurate reports faster are likely to impress the investors. Through the support of an offshore team, it is possible for finance leaders to access financial reports faster, which helps in speeding up the preparation and release of investor reports.
5) Increase the value of the portfolio
Big M&As, consolidation and major investments are a new normal in the student housing industry. Streamlined operations and finance & smooth accounting functions make properties and portfolios more attractive. They can be also instrumental in driving up their value in the eyes of potential investors.
6) Benefit from expert and specialised staff
As long as you are not shopping from the bottom-half of the pile, established outsourcing partners will have a team of qualified and professional accountants. Some providers may even have accountants who specialise in property management or student housing. This means that you can potentially tap highly talented resources at a fraction of the price.
7) Stable and flexible staff
It’s no secret that the student housing sector sees a lot of employee movement. By selecting a reliable vendor for your accounting functions, you get the flexibility to ramp up resources as and when you need. As the outsourcing partner is responsible for recruitment, training and retention, you are guaranteed a stable team.
8) Support for business growth
Successful outsourcing brings competitive advantage to student housing companies – better reporting, reduced costs, efficiency improvements and streamlined processes. It also allows the finance leaders to focus on higher-end, strategic activities that pertain to business growth.
9) Leveraging technology
Digitisation and automation are changing how accounting teams function. Most accounting departments lack the wherewithal and experience to implement innovative technologies in-house. For finance leaders eyeing process transformation through technology, it is a no-brainer to partner with providers who have prior experience in the area.
Wondering how exactly F&A outsourcing can help your business? Don’t hesitate to get in touch with us with your queries – our student housing accounting specialists would be happy to help you.