Sourcing strategy of Belgian SMEs: empirical evidence for the accounting services

Authors: Everaert, P.¹; Sarens, G.²; Rommel, J.³

Source: Production Planning and Control, Volume 18, Number 8, December 2007 , pp. 716-725(10)

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Abstract:

The primary objective of this paper is to examine the sourcing strategy for one business function (accounting services), by looking at the degree of outsourcing for each task of this function. Three research questions are addressed: (1) What sourcing strategy do SMEs use for accounting services? (2) What are the reasons? (3) Is there a link between sourcing strategy and company characteristics? The research design consisted of a postal survey sent out to 1200 managers of SMEs in Belgium. The main results showed that 53% use selective outsourcing, i.e. combining both an inhouse accountant with an accounting service provider. The results also showed that 35% use total insourcing and 12% prefer total outsourcing. Surprisingly, cost reduction is not the main reason for outsourcing. External expertise is the main reason for selectively outsourcing. SMEs select a total insourcing strategy because they want the accounting information at hand. Finally, larger SMEs decide for a total insourcing strategy and prefer to keep the accounting services internal. The conclusions show that future research should focus on the degree of outsourcing. The practical implication of this study is that accounting service providers should highlight their expertise and overcome the disadvantage of remote data analysis to attract more SME-customers.

Keywords: Outsourcing; SME; Sourcing strategy; Service providers; Accounting

Document Type: Research article

DOI: http://dx.doi.org/10.1080/09537280701706195

Affiliations: 1: Faculty of Economics and Business Administration, Department of Accounting and Corporate Finance, Ghent University, Gent, Belgium 2: Department of Finance, Université Catholique de Louvain, Louvain School of Management, Louvain-la-Neuve, Belgium,University of Antwerp, Faculty of Business Administration, Department of Accounting and Finance, Prinsstraat 13, 2000, Antwerp, Belgium 3: Catholic University of Leuven, Public Management Institute, Leuven, Belgium

Publication date: 2007-12-01

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Sourcing strategy of Belgian SMEs: empirical evidence for the accounting services

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