Based on my 20 years of experience personally mentoring more than 2000 accountants as they built their successful practices, I’ve identified a few fundamental guidelines that all accountants should follow to maximize their chances of success.
If accountants genuinely want to launch their Accounting and Tax CPA practice successfully, they need to give themselves the best possible chance. To achieve this goal, one must remember that a solid clientele and a solid set of tools to serve them are the bedrock of a successful practice. When starting, many aspiring CPAs sabotage their chances of success by burdening themselves with high overhead costs. Expenditures that are currently unnecessary can be put on hold. Get only what you need to serve your first customers. Initial overhead costs should be kept as low as feasible to generate positive cash flow as soon as practicable.
It is advised that accountants work out of their homes when first launching an accounting and tax CPA firm. In today’s technologically advanced world, clients are often open to accountants who operate remotely from their homes. It makes customers feel as though they’re getting more for their money. They reason that if the accountant has lower operating costs, some savings should trickle down to the customers. By reducing outgoings like rent and utilities, accountants can boost their positive cash flow and utilize it to fund their business growth without taking on further debt. The accountant can assess if opening an office is worthwhile after the cash flow is stable enough to cover overhead costs. Accountants who work from home may enjoy it so much that they won’t ever go.
One additional way accountants can keep costs down is by not investing in expensive software they won’t use. Many accountants waste their clients’ money on expensive software they won’t even use. There are top-notch software developers out there offering high-quality solutions at reasonable prices. Drake Tax Software has earned a stellar reputation while being surprisingly affordable. The findings of a software survey were published in the September 2011 issue of The Journal of Accountancy, and Drake Tax Software achieved a perfect score. Start-up accountants and tax CPAs would do well to invest in reliable, low-cost software that provides them with the fundamentals they need to begin serving clients.
A new tax and accounting firm can save money in various other straightforward ways. The accountants might save money on marketing by choosing a different name for their company. Accountants can save money on DBA registration, bank, and filing fees by doing business under their first name, middle initial, and last name, followed by CPA and Certified Public Accountant. Furthermore, CPAs currently in good standing can use their own words when conducting public accounting rather than having to register a separate business name. A CPA’s ability to use a fictional character can damage their reputation with potential clients, slowing down a new company’s launch. A licensed CPA who advertises their services as “Bay City Tax Service” or “Accounting & Tax Service” will be seen as less trustworthy than just promoting their services under their legal name. In the eyes of potential customers, this business may lack the necessary certifications and licenses.
CPAs currently working but have thought about beginning their own accounting and tax practice are advised against leaving their existing positions. Instead, people should advance their skills while staying in the workforce. When weighed against quitting one’s job to focus entirely on one’s practice, this choice can be time-consuming; nonetheless, the benefits far outweigh the costs. Without putting undue strain on their personal or family finances, accountants can expand with the company and eventually work there full-time.
There will be a significant increase in income with a minimal outlay of resources thanks to the release of financial stress brought on by running the new practice alongside the existing one. Cash reserves will expand significantly when current employment income is maintained, and new money begins to trickle in from the new profession. A full-time transition can be financed with the additional funds, which will make the shift go more smoothly when the time comes.
Accountants considering leaping to full-time practice will discover that January is the best month to do so. Income tax preparation services often see an uptick in business at the start of the tax season in January. The boost in income will arrive at the precise moment when the bookkeepers are desperate for cash. Accountants who want to make the most of their first tax season should get the right mindset to sell themselves well before the filing deadline. In addition, many companies’ year-end tasks, such as payroll and financial reporting, occur in January. Because of this, the accountants’ offices will bring in more money during the transition month.
When bringing in new clients for your firm, January is arguably the best month of the year to switch to full-time. Changing accountants is a difficult task for most business owners. Clients of an accountant usually need a compelling cause to switch accountants. A client who has decided to switch accountants will typically wait until the end of the fiscal year before making the switch. Therefore, the end of the year is the best time to approach business owners, and doing so will smooth the way for the practice to become full-time.
Finally, while launching an accounting and tax CPA firm, it’s best to avoid treating accounting and tax services like a commodity. As a result, you’ll probably only get a few uninterested customers. It can also be very costly. Many accountants fall for the high costs of various organizations’ marketing efforts and the enticing but unenforceable guarantees they give. The majority of these shows revolve around a commodity. Trust and loyalty, rather than low prices, are the primary motivators in the accounting sector. An accountant’s marketing efforts should be motivated by truth, honesty, and professionalism, as these traits will give clients confidence that they are working with a reliable professional.
Following a few basic procedures, accountants and CPAs who are currently employed but want to start their own Accounting and Tax CPA firms will be successful.
1) Don’t waste money on pointless things.
2) Think about opening a home-based CPA firm.
Third, continue working while you hone your skills.
4) Don’t treat your company like a product you’re selling.
It’s essential to take advantage of whatever chance you get. Failure to act will result in missed opportunities. Active accountants create favorable conditions for their success. While still in the workforce, they should launch their own CPA and accounting practices from their homes. They will have the self-assurance and financial resources to enjoy the benefits of owning an Accounting and Tax CPA Firm because of the experience they have gained without endangering their future.
Visit http://www.accountantsmarketing.com for additional information on promoting your accounting firm or reading about Frank’s strategies.
Salman, Frank E.