Accountants want to make a shift from being employees to firm owners, at least most of them! If you have the aspiration and have been thinking about this transition, then congratulations! You are mentally there. But it is not enough to just place yourself in the designation of your dreams. There is so much more that goes into ensuring that you take the right steps in the right direction to set up for success.
Making the leap is a significant career move and comes with its own set of excitement, opportunities, and challenges. While the idea of becoming your own boss is thrilling, the thought of having to do it all on your own can be overwhelming. Launching a successful accounting business is more than having the desire and the experience. While this might seem easy on the surface, thinking like a business owner, and taking the responsibility of all successes and failures requires a major shift in approach.
In this article, Finsmart Accounting – trusted globally for offshore accounting services – will share major challenges faced by accounting employees while becoming a firm owner and also list out tips to overcome them. Let’s start by discovering the key challenges first!
Key Challenges During This Transition:
Owning your business, and generating employment can be exciting. However, the process is not devoid of challenges. Let us understand the key ones:
– Financial risk and uncertainty:
Unless you come with a huge financial backup, this is going to be a concern. No business, from day one, can generate revenue that ensures owners of good times only. While as an accounting employee, you had a steady flow of income, in the form of salary, that will no longer be the case. The responsibility of generating revenue is on you. Managing cash flow, securing clients, and covering the expenses of the business and the employees are some of the significant things you need to be mindful of.
– Managing growth and expansion:
Growth is, most certainly, a positive sign for a business, but it has its challenges. As the firm grows, you will need to hire additional staff, expand your services, determine their prices, and maybe add new locations. As business owners, you need to plan carefully for scaling purposes. Investment in infrastructure, technology, and training support can leave you with sleepless nights, altogether.
– Balancing the professional and personal:
To be fair, becoming a firm owner can be demanding. Especially, in the initial days, when accounting firm owners have to wear multiple hats, they can feel exhausted all day due to the long hours, tight deadlines, and exceeding client demands. It can take a toll on mental and physical health. As a new firm owner, you might find it extremely hard to set boundaries and say no and that makes things worse.
Recommended reading:
Dangers of AI tax advice
All about real estate accounting
All about contractor accounting
Top accounting conferences of 2024 to grow faster
Now, let’s learn about some expert tips to grow as an accounting firm owner after making the transition from an accounting employee.
Accounting Firm Owner Transition: Things to Keep in Mind
Before you get into the shoes of a business owner, remember it is not going to be easy. The process is going to take a lot of your time, energy, and attention. But with the right support and planning, you can ace it all. Here are some things you should focus on:
– Protect your time:
Being an accountant is so much different from being an accounting firm owner. As an employee, your performance is determined by the completion of the dedicated tasks. But as a business owner, you will need to focus on the big picture – the strategy, the planning, and the right investment in people, platforms, and processes. You might think that being a business owner is about being busy and that is far from the truth. In reality, as a business owner, you would hardly be doing accounting. It is about setting the rhythm of the life you want to build, the problems you want to solve, and the vision you wake up with. It is key for you to indulge your time in things that matter. Looking to offload or outsource the repetitive tasks that make you “busy” can help you keep your focus centralized.
– Build and bank on the long-term relationships:
When you become an accounting firm owner, you are levied with more accountability. Your actions are far more consequential, and the business relationships, are important. Strengthening your relationship with clients can pave the path to long-term success and generate better overall results for your business. To concentrate your focus on relationships like these, you should consider implementing an advisory model. Instead of choosing a billable hour model, you should consider value pricing.
This allows your clients the flexibility and you to lay out the scope of the engagement. This technique also opens up the opportunity for a year-round transaction with the clients. Remember, every service you offer, the value you add, and the knowledge you share isn’t for free. If you do it right, positive reviews will also come in! Watch out one of our clients speaking good things about us!
– Define your vision and goals:
When you are just starting as a business owner, it is very easy to lose track of what is important and what needs to be focused on. Clearly defining your vision, goals, and objectives helps you stay on track when you are too overwhelmed. As the team continues to grow, it will also help them to understand the problems you are trying to solve for your clients, the approaches you adapt, and why you do what you do. Before you set out on this journey, make time to ask yourself the vital questions that define your firm and set you apart. Establishing short-term and long-term goals will guide your decisions and help you stay focused during the transition.
– Develop strong finance management skills:
Being the owner of an accounting firm doesn’t require you to perform accounting tasks daily. However, it needs you to have a solid understanding of the financial management principles. From budgeting to cash flow management to financial forecasting and pricing strategies – you should have a sound knowledge of it all, even if you have a team of experts who are adept at doing this. Investing in technology, and automation tools can not only help streamline the financial processes but provide essential insights that are key in analyzing the firm’s performance. Remember, investing in the right tools, processes, and people can help you manage your firm effectively and ensure success.
– Invest in marketing and branding:
We live in a digital age today. Gone are the days when word-of-mouth would act as the superior tool for you to gain clients. For the new firm, you need to establish a strong brand identity, that showcases your business and the offerings, just the way you want. Having a professional website is a must. Business cards and other marketing materials that reflect your brand are equally important. The employees you need, and the clients you want have a strong digital presence and that is the only easy way for them to find you and vice versa. Use content as a tool and adapt digital marketing strategies to help you reach your target audience and generate leads. It is essential to remember that consistent branding and marketing are key to building credibility.
– Hire and delegate:
While in the initial days, you might have to wear multiple hats, you must have a plan. Are you going to build an in-house team of accountants, tax professionals, HR, marketing executives, etc? Or are you setting up a team of outsourcing professionals? If you are just starting as a business owner, outsourcing comes with multiple benefits and probably, is the one you should choose. From low costs to no hassle in finding the right talent, from gaining expertise in the area you need to being able to scale easily – outsourcing provides multi-faceted benefits.
Besides, you will also need to learn to prioritize. Learning to have the right team in place and delegating tasks as and where possible help accounting firm owners maintain productivity and avoid burnout.
Transitioning from an Accountant to a Firm Owner – Conclusion
If you have decided to become an accounting firm owner, you are setting yourself up for an exciting journey. There are challenges, but nothing that can’t be overcome. Setting up a strong team of accounting and finance professionals, seeking help from the strong network you build around you and meticulous planning can go a long way in ensuring that your brand-new accounting firm is a success. Stay focused, invest in skills and relationships, and get set to adapt to changing circumstances.
Want to ensure success for your new accounting business with outsourcing? Write to us at connect@finsmartaccounting.com.
Don’t forget to check out these services and recent blogs:
Choosing accounting practice management software
Director Growth Strategy & Alliance
Maanoj Shah is a finance and outsourcing expert with strong Business Strategy and Scaling-up experience. Over the last 20 years, he has incubated multiple businesses and helped build global enterprises in verticals as diversified as hospitality, technology, and healthcare.
