Vertical Integration When business owners Jamie Davison and Nathan Hood merged their accounting and bookkeeping firms to form Carbon Group, they’d both experienced the frustrations of having to deal with multiple business services providers to keep their businesses running smoothly. From finance brokers for providing them with access to funds, to insurance specialist for ensuring their business had the appropriate cover: the timely tasks of communicating with providers and filling out forms left them both dealing with time-consuming administration tasks instead of engaging in revenue-earning client work...
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n 2014, they launched Carbon Group, with the aim of providing a one-stop shop for core business needs. They acknowledged the gap in the market to be a complete service provider for small to medium businesses, and so the Carbon journey began. Initially launching Carbon Accounting and Carbon Bookkeeping, they then hired an IT specialist to form Carbon Business Systems; a division dedicated to providing cloud integration solutions. Carbon Bookkeeping was using the online accounting software Xero, and the cloud-integrators became preferred partners for a range of Xero add-on Apps. These included online rostering applications, point of sale solutions, and job management software. All of this worked in the cloud, and integrated with the accounting software to provide seamless integration of data, giving business owners and management access to accurate information at the touch of a button. This allows better business decisions to be made, based on real-time data. Shortly after, they hired finance and insurance brokers, launching Carbon Finance and Carbon Insurance Brokers. More recently, 8 / Issue 12
Carbon introduced Carbon Wealth; a division led by a financial planner who liaises with clients to implement strategies to safeguard their financial future. Vertical Integration Model Carbon Group’s model is set up so that the group (founded by Jamie and Nathan) holds at least 50% ownership in each division and then the remainder is owned by the partners in that division. The reasons behind this? Each stakeholder gets the best of both worlds, since the partner is assisted with direction, strategy and consistency from the head group, which provides the co-founders assurance that everyone is aligned and the Carbon brand remains strong, with minimal chance of it dissolving. For Jamie and Nathan, allowing new partners to have a share of the business means more people with skin in the game who own and actively run the business as if it were theirs. Starting with the accountant as the initial touch point, the business structure is set up, before the cloud integrators assess the client’s IT requirements and provide cloud applications and systems to ensure business efficiency. The bookkeepers
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Jamie Davison, Co-founder, Carbon Group Jamie Davison launched Carbon Group in 2014 with co-founder Nathan Hood. The aim was to offer business owners with a one-stop shop for core business needs. Carbon has divisions led by industry leaders in accounting, bookkeeping, cloud integration, insurance, finance and financial planning. Initially operating from one office in Perth, Carbon has grown exponentially to now having three locations in WA and one in Melbourne, with goals of expanding further.
then step in to set up advanced but user-friendly bookkeeping technology, usually Xero. They take care of all requirements from the government, such as business activity statements, payroll tax and payment summaries, before passing on to the accountants who compile EOFY documents such as tax returns. Around March time, the accountants are available to engage with clients to offer tax planning strategies to help minimise tax payable, and increase business returns. Proactive advice ensures that the business growth is phased for maximum benefit, while also reducing the likelihood of EOFY shocks. The accounting partners are on hand to act as an advisory board, who can share their knowledge and experience of growing a successful business, to help clients exceed their business goals. Throughout all of this, the team of finance brokers, insurance brokers, and financial planning experts are available to provide access to finance, insurance policies, and strategies to ensure a stable financial future. Benefits of Vertical Integration Clients enjoy the benefits of this model in many ways. By having their business services managed
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