Our accounting firm success tips are universal for anyone who owns an accounting firm, however we wrote them with the first-year buyer in mind. As you might imagine, buying a practice, especially the first time around, is an exciting and challenging endeavor. Poe Group Advisors has worked with some really smart and energetic buyers to do some amazing things with their new practices. These helpful tips are based on our experience on what we’ve seen work for successful accounting practice owners. We hope these will provide some valuable insight to those who are bold enough to venture into the unknown and own their own firm.
Make a Business Plan
Business owners in general undervalue planning. The mindset some have is essentially, “There is no value in thinking about what you are going to do when you could be doing it. Action and action alone is how you get things done.” It’s certainly true that you have to act and focus on the work that brings in revenue, but planning in order to step back and keep your eye on the big picture is absolutely crucial. It helps ensure you are channeling your activities in the right way. That involves setting goals and creating strategies to achieve those goals.
Build a CPA Practice that Serves Your Interests
What are your interests? It’s important to know what you want from your business. Some CPAs are so focused on their clients and staff that they forget why they went into business in the first place.
Things to consider for your CPA firm:
- Desired income
- Desired time off/ freedom
- Desired office style
- Ideal office culture
- Type of accounting work you prefer: Do you prefer more time engaging with clients or working behind the scenes with problem solving and complex tax planning?
Determine Desired Accounting Practice Size
Some people really enjoy “doing it all” and want to keep their cps practice small so that everything is within their control. Others are great at team building, delegation and naturally gravitate toward building a large firm. There is no right or wrong accounting firm size.
Regardless of firm size, we’ve seen a lot of practice owners struggle with finding just the right work-life balance. Interestingly, what’s right for you at one point in your career may not be right at another.
Avoid Overworking Yourself
Time away from the office without email and checking in with the office is how you recharge. A lot of people see time off as a luxury, but it’s much more than that. When we start experiencing symptoms of burnout our productivity falls off pretty dramatically. At certain times of the year, long hours are sometimes a necessity in public accounting. If you are going to build a business, time off is essential to get back your energy and problem-solving creativity to blast through the various challenges that block your progress. What good is a day off if you spend a lot of it checking email on your phone? Learn more about this topic in What would happen if you started working less?
Charge What the Market Values You At
Charge what the market thinks you are worth, in contrast to what you think you are worth. If your practice is underperforming when it comes to profitability, this is likely the easiest path to meeting your profit goals. We’ve seen a great mix of practices over the years and underpricing is quite common. It takes courage to increase fees and some clients will resist. We recommend a strategy that takes a trial and error approach. Essentially, you test price increases on a small sample of clients and also test pricing on new client work. There is an outline of this methodology in the Accountant’s Flight Plan.
Select an Industry Focus
Have you heard the saying… “Niches Bring Riches?” It has certainly been our experience that this holds true for accounting firms. We believe this will become even more true as new technology makes compliance work easier, more efficient and more competitively priced. Clients value deep knowledge in their industry and they are hungry for more advisory services. The other aspect of focusing is that complexity in many areas of accounting is increasing. It becomes difficult and inefficient to try to offer a large variety of services without a large, specialized team.
Hire Expert Staff
There are a lot of clichés about team building/hiring: hire slow and fire fast, your people will make you or break you, there is no “I” in team and lead by example.
The interesting thing about these is that they are actually worth heeding. Staffing an accounting practice is challenging and the current environment is tight for talent. Good people are expensive, but with good leadership, are completely worth it. If you are growing your firm and adding team members, it is very helpful to have your pricing set at a profitable level before hiring. In many cases, a firm can add capacity by weeding out clients who are no longer a good fit for their practice.
Provide Service Worthy of Referrals
The good news is that you can build an amazing practice through word of mouth and referrals. The hard part about that is you first must provide service that is worthy of a referral. If you are serious about getting more top clients through referrals, step one is taking a really good look at how you might improve the client experience. In fact, this needs to be a continual process. One of the best ways we do this at Poe Group Advisors is by involving our team. We ask our team, “What are the pain-points that clients have been experiencing? How can we create solutions to either prevent or mitigate those problems?” I’ve been amazed and grateful for the ideas our team has come up with. We also let our team know that our goal is “to create service worthy of a referral.” This not only helps us create a motivating standard for our team, but it drives growth. When we know a right-fit client is happy with our service and receiving value, they are happy to refer others to us.
Enjoy Your Practice
Can work be fun? Work is work and all of it won’t be fun, but a fun workplace can be more productive and experience extremely low turnover. In fact, fun is probably one of the most undervalued leadership qualities on the planet. Thinking back on my own experience of working for others, my favorite places to work were both very successful companies and had extremely fun environments. The owners knew how to have a good time and were generally just good people to be around. Check out our past fun blog post to read more.
Stick to Your Core Services
Focusing on your core business, diversification does not always increase your revenue and can drain your firm’s resources.If you choose to focus on financial planning, consider selling off the tax side of your business. The key is to first determine what aspects of your professional practice you most enjoy. Secondly, identify what you’re particularly good at doing. Here’s a hint: the two will generally go hand-in-hand. Pick an area that you are comfortable with and stick to it.
We hope these 10 tips will help you create the practice of your dreams.
FIND OUT HOW TO OPTIMIZE YOUR ACCOUNTING PRACTICE TODAY!
Pro-Tip: Whenever you’re ready, here are 4 ways we can help you with YOUR accounting firm:
1.Download our Growth Guide – a case study of how one CPA grew from scratch to $100M.
2.Check out this video and learn how to focus your practice through delegation and boundaries around your time.
3.Click here and download our 8 module description of Accounting Practice Academy to learn more about how the workshop can help your firm.
4.Looking to exit or acquire? Check out our practice marketplace.