Starting Your Own Accounting Business: 5 Things You May Not Have Considered

Have you been thinking about starting your own accounting business? It can be tempting to take this leap into being your own boss, but there are several things you should consider before you move forward. There are plenty of advantages to running your own accounting business, but just because you are great at accounting doesn’t necessarily mean that you’re ready to be a business owner. The points below are all important ones to consider.

Your Education

Both starting an accounting business and education cost money, and you might be concerned about spending money on your education that you should be setting aside for your accounting business. However, having the right education is critical as well, and a graduate degree can really unlock your potential and prepare you for success. You may be able to get student loans from a private lender at a favorable interest rate to pay for the degree.  Either way, there is a path to becoming an Accountrepreneur.

Buying One or Starting a New One

One of the most important decisions you’ll need to make is whether to purchase an existing accounting firm or start your own. There are different factors to keep in mind, and some of them will be specific to the company that you are considering buying. First, think about costs. On the one hand, you can arguably start your own accounting business out of your house with very little overhead. However, you might have to spend some money on marketing and getting your name out there, while an established firm might already have better name recognition. On the other hand, there’s no question that you’ll need a substantial amount of money in order to purchase a company.

If you’re buying a firm, one thing you have to be careful about is their existing financial situation. You will need to be prepared to really dig into their records and make sure you understand any liabilities they have. The owner of a struggling company that is up for sale might not be very forthcoming about money problems. When you purchase a firm, there are certain things that might be out of your control, like client loyalty and whatever rates the business has established. You can certainly increase the rates later, but you’ll need to keep them the same to start with.

Along similar lines, you may need to offer the same services for a while as you make the transition while if you start your own, you can simply offer what you want. Software and other equipment are going to be necessary and potentially costly. If you purchase a company, make sure you know exactly what is coming with the purchase and the age and condition of it all.

Either way, consider being in business for yourself but not by yourself with Universal Accounting Center.

Managing Employees

Whether or not to have employees might not be a decision you have to make immediately, but it is something you’ll need to deal with eventually. If you are starting from scratch, it might just be you, but you may want to add staff over time. If you’re purchasing a company, there may already be employees.  How much do you know about managing people? It may not be enough to be a good accountant.

This is where a degree in management could come in handy if you don’t have a background in it. If you have neither of these, you might want to read a few books about management and, if possible, explore taking some classes or seminars. Managing people is a skill in itself, and it’s a mistake to think that just because you are a whiz at accounting, you’ll also be great at management. Of course, some people are naturals in this position, but doing some reading can help confirm your instincts or shore up places where your skills might be weaker.

Your Personal Qualities

Having the right qualities to be an entrepreneur go beyond management skills. You also must know that owning your own business comes with many shades of grey. You might currently be asking yourself basic questions like is starting a tax prep business right for me but you need to understand that knowing if you have what it takes to actually do it is going to come from many more in depth questions about who you are as a person.

One irony you may face is that the very qualities that make you an excellent accountant are not necessarily that same ones that make for an excellent entrepreneur. Accountants may tend to be cautious and conservative, not risk takers like many entrepreneurs. There is an element of financial insecurity associated with running your own business that may fly in the face of your instincts. However, careful, and cautious people can be successful entrepreneurs as well. Making sure you have the right business knowledge and skills will be important. Writing a business plan can help you figure out where your weaknesses may be, and you’ll need one if you’re planning to seek loans or other types of funding.

Networking and Building a Client List

It’s not uncommon to get so caught up the various details of getting everything up and running that you lose sight of what you most need to succeed: customers. Are you a people person? If you’re more comfortable with numbers than people, this may involve some effort, but you’ll need to retain clients if you’re buying a business and attract them in the first place if you’re starting your own. And without the big budget that large firms have, that may depend on your ability to network and sell yourself and your company effectively.

You should work to strengthen the existing contacts you already have in the industry and locally and think about how you can make yourself more visible. This will vary depending on the type of service that you offer and the clientele that you want to attract, and you may want to consider working with a marketing firm or an individual to help you raise your profile if you are struggling to attract clients.

In short there is a Turnkey Business Plan for accounting professionals, there is no need to feel like you need to reinvent the wheel.

Why is Bookkeeping Important?

The absence of bookkeeping in a business is like a road without signs because you’re likely to arrive at a different place than intended. Any large business learned the value of financial records produced by bookkeepers is crucial for proper management.

Bookkeeping is essential to every business for both financial and legal reasons. Without record keeping, it is difficult to get a business loan, and impossible to do taxes. Even more importantly, without the information that bookkeeping provides, wise decision-making is tricky and can lead to disastrous conditions.

There is a close correlation of success with those that realized the importance of bookkeeping and those that did not. Those that thought bookkeeping was an unnecessary luxury judged the success of their business by the amount of money in their bank account. Their thinking was “If I have money, I must be doing well.” That assumption, all too often, caused them to always be in the “fire-fighting” mode of management. Unfortunately, a lack of a bookkeeping system would end disastrously for the owner, with mortgages on their home, and bill-collectors hassling them. It even led to bankruptcy too many times.

Certainly, bookkeeping does not guarantee success. Nor is it all that is needed. Yet it leads us to information that can help us make well-informed decisions. Allen Bostrom, in his book “In the Black”, states “You hear a lot about the importance of making decisions based on data. What I have learned is that decisions should be based on wisdom, not necessarily data alone.” He goes on by describing the Wisdom Pyramid which is a triangular shape with “Data” at the bottom and topped by “Wisdom”. In other words, data leads to information, information leads to knowledge, and knowledge leads to wisdom.

In summary, the difference between achieving entrepreneurial dreams and disaster for a small business owner is often based on their appreciation or lack of appreciation for the information coming from a bookkeeping system.

Do I Qualify to Start an Income Tax Preparation Service?

The IRS is not restrictive in who may start an income tax preparation service, other than they require a person to get a Preparer Tax Identification Number (PTIN). To get your PTIN, go to the IRS.gov website, and it will direct you to the online application. It costs under $40 and takes about 15 minutes to complete the application to start a tax preparation service and receive the number. Generally, those having a felony conviction for tax fraud and other forms of financial crimes are not eligible.

A few states such as California have additional qualifications. If you want to prepare taxes in these states, you may have to take a test and register with the state licensing department. If you want to determine if your State is one of these, call the state department over licensing, or check it out online. They can tell you of any special requirements for tax preparation services.

Most municipalities require you to have a business license. This fee could range from $50 to hundreds of dollars. To research what it will cost you, search on “business license cost for (your city)”. In most cases, you can also complete the application online.

Contrary to a common misconception, a person need not have an accounting degree or be a CPA to prepare taxes. In fact, no specific education is necessary although it is a good idea to understand the basic definitions in the tax law before you hang out your shingle.

Though the income tax software does the hard work, a tax preparer should understand how to determine income tax status, who qualifies as a dependent, the process for calculating itemized deductions, and how to read the tax tables. With this simple knowledge and the help of software, a person can prepare more than half the returns they may be asked to prepare.

Nonetheless, the more income tax knowledge a person has, the more confident they will feel and the more returns they will be able to complete. Furthermore, the more complex a return, the higher fees, and the more income per hour a person will generate. For instance, a simple return may only generate a $75 fee. Yet, a more sophisticated return could earn hundreds of dollars and take less than one additional hour to complete.

The upfront investment, though not a qualifier, is among the lowest of any new startup. Other than the PTIN and business license fees mentioned above, the tax preparer needs a computer, printer, and tax preparation software. TurboTax and H&R Block, to name a couple, are not good software for the tax preparation business. With these individual packages, you will be limited in the number of returns, and your ability to complete all returns.

Instead, you will want a more robust package designed for professional tax preparers such as Intuit ProSeries, TaxWise, and Drake costing well over $1,500. These software packages are designed to be efficient, accurate, and for unlimited number and sophistication of returns. Take time to make the right choice, because you will likely want to use the same software for at least five years.

In summary, most people with basic knowledge of tax law and the help of a software package can thrive in a tax preparation business.

Print and Digital Marketing

Advertisement is at the core of our society, whether we look at marketing campaigns targeted at customers (B2C) or companies (B2B). Knowing how to market your services or provide your clients with marketing tips is crucial, even if your primary concern lies in accounting.

According to published reports, 69% of businesses have a fully documented marketing strategy in place, with 76% using organic traffic, or SEO, to measure success. Blog posts, which are the most popular means of marketing a website, also take far longer to write now than only a few years ago. Readers’ expectations have skyrocketed over the years, and writing, editing, formatting, and publishing marketing content is an industry in itself.

Given that we live in a cloud-based, post-COVID world, digital marketing takes precedent over printed campaigns at the moment. Despite that, taking both into account, no pun intended, can help your brand stand out and attract more clients. Let’s discuss marketing know-how for accounting professionals and how you can jump-start your content marketing efforts in 2021.

Printed and Digital Marketing – Using Both to your Advantage

When you decide to market your services as an accountant, you can go about it in two distinct ways – through printed or digital media. As their names might suggest, both rely on drastically different mediums for distribution. Some marketing content formats you can consider using for your purposes include:

Printed media

  • Business cards – traditional cards used for networking with clients
  • Brochures – fold-up paper sheets with your accounting business’ services
  • Posters – one-way printed papers which can be glued or stapled on walls
  • Printed ads – ads that you can order from newspapers for the sake of marketing
  • Office miscellanea – pens, pins, lighters, mugs, and other office items with your logo/info

Digital media

  • Blog posts – online articles discussing industry topics, how-to guides, and accounting trends
  • Social media posts – images, status updates, polls, live Q&A, and other content specific to social media
  • Podcasts – discussions with accounting professionals and influential guests about various topics
  • Videos – tutorials, discussions, news reports, and other types of videos you can personally host
  • Freebies – PDFs, eBooks, presentations, and other free materials on accounting topics you can share

It may seem overwhelming to choose which marketing content would best suit your accounting business. You can also refer to TrustMyPaper to assist you in writing and editing your marketing plan once you start creating your content. You don’t have to commit to anything upfront, and you can pick and choose different content types to create a unique set of options.

Marketing Content Tools to Consider Using

When it comes to marketing tools, most of them fall into the “creation” part of marketing, and there are plenty of options to choose from. As we’ve mentioned, printed and digital marketing vary in terms of format, so different tools will be more or less suited for each medium. Some tools available to you online include:

Google Docs – all-in-one general document platform suitable for digital marketing content management.

Evernote – a platform dedicated to written content creation, marketing planning, and cloud storage.

Grammarly – editing platform which used to clean up your writing and grammar before publishing.

SEM Rush – a platform that will help you find the right keywords to use for better search engine ranking.

Canva – visual content platform suitable for presentations, infographics, and social media content.

Gimp – photo editing and content creation tool which you can use for both printed and digital marketing.

Mail Chimp – centralized marketing platform which can help you publish content and analyze its performance.

While these are only a select few tools that you can find online, their combined features will allow you to start on the right foot. If you find yourself busy with accounting obligations, referring to Supreme Dissertations and outsourcing some of your content writing or editing is a smart move. Use the available online resources to your advantage, most of which are free and highly user-friendly, and you will slowly build up your marketing strategy.

Marketing Strategies to Implement

Now that we’ve talked about the mediums and the tools you can use, let’s combine the two and talk about specific tips and strategies. Given that you are an accounting professional, you already know who your audience is and what exactly you can do for them. This makes coming up with marketing content much easier, as you don’t have to research your audience – focus on how you can help them instead.

  • Use Accounting-Specific Keywords in your Marketing

As an accountant, your clients will expect you to be familiar with niche terminology and keywords specific to accounting. Using those words will enable your marketing materials to show up much more frequently in search engines such as Google, Bing, and Yahoo. In turn, more people will click on your content and visit your website.

  • Create a Schedule and Stick to It

Publishing marketing content under your brand’s banner should never be sporadic and unorganized. Instead, use a digital calendar or a notepad and start planning your content ahead of time. For example, you can write a blog post and publish it each Tuesday, while you answer accounting questions live on social media on Fridays. There are no rules to creating a content calendar, but prepare your own nonetheless and try sticking to it.

  • Never Copy Content – Be Original

Copying marketing content from popular websites and brands will always backfire. Search engines are designed to detect copied content and treat it as spam. Your clients will be equally displeased and think twice whether to visit your website or reach out to you with such a practice in place. Use the tools available to you to create something unique and your own – your brand’s followers will appreciate the effort.

  • Make Good Use of Social Proof

Social proof represents marketing content generated by your clients and brand advocates. Satisfied clients and accounting professionals familiar with your work can write quotes and reviews for you to use for marketing. This is an effective way for accounting professionals to build trust and brand image, given how trust-reliant their profession is. Reach out to your clients and ask for quotes or reviews – make it a practice to ask for them going forward as well.

Wrapping Up and Starting Off

Marketing is a vast pool of possibilities, and the best way to learn about it is to start producing your content. It can be overwhelming to carry the weight of PR management on your shoulders. Yet, accounting professionals can market their businesses very successfully.

Go through the tools and tips we’ve discussed and take note of how bigger, more popular competitors market their services. The right marketing strategy for your business will click in your mind sooner than you think, and the rest will take care of itself.

Also, learn more how you can also Market & Sell your services online.  Get 2+ clients a month leveraging your social media presence and technology to get the clients you need to grow your business.

Image source: https://unsplash.com/photos/gcsNOsPEXfs

Branding Your New Accounting Business On a Tight Budget

As an accountant, you know the importance of setting a budget and sticking to it. Starting your own accounting business will require a disciplined adherence to a budget, and one of the things you need to fit into that budget is branding. Your company’s brand is best described as how your customers feel when they think about your company. No matter what type of brand you’re going for, branding your company is the way you shape how those customers feel. Here are a few things to keep in mind when you’re branding your new accounting company while staying within a budget. 

First, the Name

Your new company has to have a good name that’s easy to say and remember and gives a potential customer an idea of what you’re all about. Many accounting firms just take on the names of their owners, and that’s an acceptable practice; it’s a sign of credibility in the industry and gives you some legitimacy. However, consider coming up with a different name that includes one of these keywords relating to accounting:

 

  • Accounting
  • CPA
  • Bookkeeping
  • Firm
  • Taxes

 

These words will help your online branding by helping your business rank higher on SEO, especially if you can find a way to include one or more of them in your company name. 

Create Your Logo

Your logo is an integral part of your brand. If you’ve branded correctly, seeing your logo should make your customers feel certain emotions, often without them even realizing it. Accountants usually have a professional type of logo; luckily, LogoCreator.io has a variety of templates for almost every industry, so you can make your very own logo without being too outlandish or unusual for the rest of the industry. People like to see some uniqueness, but you still want them to realize that you’re an accounting firm. 

 

Part of creating your logo is determining your company’s color scheme, another important factor that will help guide any promotional items you might have made to distribute, your website design, or even the interior of your offices. You don’t have to spend money in this step, but it is important to consider what colors you want people to associate with your company. Certain colors are also more or less associated with certain emotions; you can find out more about that here

Keep Your Marketing On Brand

Now that you have a name and a logo, you can start marketing your company. You will probably want to consider getting on at least a couple of social media platforms, and you might even consider starting a blog on various accounting topics. You have expertise that other people are looking for, and especially in this field, starting a blog can help build your reputation as an expert accountant. Blogs also give you a good amount of content to share on your social media profile, which helps drive traffic to your site. If people in your area are already used to visiting your site for valuable information, that makes them that much more likely to seek out your services too.

 

However, remember that your content and marketing should be on-brand. This means you need to find a voice and tone for your posts, one that doesn’t clash with what you want your business known for. If you need help figuring out a good voice for your branding, you can find some helpful information at Column Five Media.

 

Branding really involves getting people to feel a certain way when they hear about or see your business. It’s the face of your company, and it should be something you put some thought and effort into. Branding your accounting business on a budget isn’t difficult; it just takes some thought and planning to get right. 

 

All of this complements the process to become the premier accounting firm in your area. Contact us today to see how we can help you with your accounting business.

:Written by Kristi Horton

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