Why growing your CPA practice should be part of your succession plan

growing cpa practice succession plan

1. Growing your CPA practice will help attract buyers when you go to sell.

The trend is your friend. Buyers want to see a sustainable, steady increase in revenue and profits. One year does not make a trend. It doesn’t have to be double digit growth, but nice, predictable, single-digit growth will give buyers a lot of confidence. Growth equates to good succession planning because buyers want to know that they are buying a practice that is headed in the right direction.

2. Growth allows you to keep your practice “Hair Free”.

What is “hair”? Here are a few examples – problem staff, problem clients, underperforming focus areas, and undesirable and/or “oddball” specialties. When you are growing your CPA practice, you are far less likely to hold onto things that aren’t working well. Growth tends to put you into a mindset of abundance. It provides the confidence needed make decisions that may cause temporary pain or unpleasantness. Pruning and growth go hand in hand. If your practice is stagnant, then pruning represents a permanent decline. If you are growing your CPA practice, then pruning represents a short-term bump. The bottom line is that buyers want relatively “hair-free” practices.

3. Growth helps you maintain or improve your profit margins.

Let’s face it, if you are not continually increasing your prices, you are losing ground. Increasing prices takes confidence. If you are doing it properly, you will lose a few price-sensitive clients on an ongoing basis. If your practice is constantly growing, then losses are a normal part of doing business. Growing revenue without growing margins is counter-productive. Great profit margins are desirable when you go to sell your CPA practice.

4. Growth keeps you sharp.

At any stage of your career, stagnation can set in and be very frustrating. Growth creates change and movement which requires owners to be alert. This can revive one’s career and can even extend it for many years.

Jumpstart Questions:

• What bottlenecks need to be removed before creating growth?
• What circumstances would motivate us to grow?
• What can we let go of in order to create time to focus on growing the practice?
• What happens if we do nothing?

FREE SUCCESSION PLANNING GUIDE!

accountant succession planning guide

 

 

 

 

 

 

 

 

About Brannon Poe:  Brannon is the founder of Poe Group Advisors and has been facilitating successful accounting practice transitions throughout the US and Canada since 2003. He is also the creator of Accounting Practice Academy. Brannon is the author of the Accounting Practice Insights Blog and hosts the Accountant’s Flight Plan” podcast with other top thought-leaders in the accounting profession. Brannon is an E&Y alumnus. He has worked with some of the most successful and seasoned CPAs in the industry and has been privy to the behind-the-scenes methods that these clients have used to build highly profitable practices along with capable and independent teams. Brannon has authored multiple books, including Accountant’s Flight Plan – Best Practices for Today’s Firms (published by both the AICPA and CPA Canada) and On Your Own: How to Start Your Own CPA Firm, Second Edition (published by the AICPA). Brannon is passionate about entrepreneurship and is the president-elect of EO Charleston (Entrepreneur’s Organization)