How to Start a Successful Accounting Firm
If you’re looking to start an accounting firm, you’re probably tired of working for the man, and you want to be the man — figuratively speaking. You may wish they did things differently, and you just want to handle things your way. This is understandable, as many people start their businesses for the same reason. Natural leaders want their values and passions to be instilled in their work – which is often a unique selling point for small business owners.
But starting an accounting firm is not as simple as it seems. Are there any simple aspects? Yes, but you need to lay the groundwork for legal compliance and financial success before you quit your job and dive deep into the world of business ownership. In this article, you will learn the basic fundamental steps to starting a successful accounting firm.
What services are you going to offer?
If you are a certified public accountant (CPA), you will have more flexibility in the services you can offer your clients. First, it’s good to choose a niche industry to target. Then you can provide specialized services for that niche. For example, if you work with clients in the trucking industry, you can sell bookkeeping, tax preparation, payroll, and more. Remember that trucking companies must also pay quarterly fuel taxes according to International Fuel Tax Agreement (IFTA) – which could be a specialized service that you provide.
Business building blocks
Before bringing your services to market, the first step is to become a legal business entity. Although this is not legal advice, it’s hard to be taken seriously if you don’t take yourself seriously.
So, first, you will need to write a business plan if you are going to seek financial help from investors. Following, set up a commercial structure – as an LLC or S-corp. Then you can get an Employer Identification Number (EIN) from the IRS. This is required to open a business bank account and pay employees and general requirements vary from state to state.
A long-debated talking point among contractors is the hourly rate versus fixed rate pricing structure. Honestly, which one you choose comes down to profitability. While some services will make more money per hour, others are best set at fixed prices. This is especially true if you can operate quickly while delivering immense value to your customers. For example, if you offer tax preparation, you’ll want to charge a flat rate for each type – simple returns being the cheapest, then increasing in price as complexity increases.
You may think you can do it all independently, especially if you work from home. However, a lot of office work will pile up if you operate this way. So instead, hire one or two clerks to handle the front desk and take care of the tedious tasks. When you delegate these kinds of monotonous tasks, you can focus on what you do best: growing your customer base. Then you can hire additional CPAs or outsource freelancers as your business grows.
As you build your customer base, you will need accounting firm management software to track work, meet deadlines, and assign tasks to others. Plus, you can quickly communicate with your employees or contractors if everyone is working remotely. Plus, workflow management makes it easier for you to rest easy knowing everyone is on the same page. While you may be able to handle workflow management internally at first, as the business grows there is often too much room for human error.
However, you risk developing a reputation for being disorganized and late without it. And no one wants to work for a company that adds unnecessary stress to their daily routine. So you’re more likely to retain reliable employees if you can make their jobs manageable and simple.
Building your client base can be the most daunting part of starting a successful accounting firm. However, you can make it work if you dedicate yourself to learning proper selling skills. When you’re just starting out, it’s essential to put as much effort into your own marketing as possible. There are several ways to market your business, including:
- Ask your friends and family to spread the word: Word of mouth is far from dead and it’s a great way to establish yourself locally;
- Subscription to paid advertisements on Google or social networks: Paid advertisements are an excellent short-term and immediate option for visibility and attracting new prospects;
- Hire someone for content marketing: Marketing your accounting services through content is one of the most organic ways to grow your customer base. Although blogging might seem simple enough, there are many steps to ensure your content is optimized for search engine ranking factors, so content marketing is best left to the professionals.
Once you find clients, be sure to provide them with top-notch care, so they feel like they can’t get your services anywhere else. This is essential to stand out from the competition as well as to build customer loyalty. The key is to nurture them personally and show them (not just tell them) that you have their best interests at heart.
Starting a successful accounting firm is simple in some ways, but you have to commit to making it work for the long term. If you can’t stay on top of tasks, you’ll fall behind and your business will crumble in the first year. Starting a successful accounting firm is just the tip of the iceberg. Long-term success comes from proactively evolving and expanding your business to be the best it can be.