Buy Accounting Business: Everything You Need to Know
All you need to do is search and find a suitable accounting business on sale and negotiate a mutually beneficial deal.3 min read
Buy accounting business to get a quick start in the accounting industry. All you need to do is search and find a suitable accounting business on sale and negotiate a mutually beneficial deal.
Legal and Accounting Businesses in the U.S.
Accounting and legal businesses help professionals and business people record and analyze their income and expenses, comply with the tax requirements, and ensure that a company's business is being operated the way it should be.
Accounting firms alone are a $100 billion industry in the United States. In 2013, there were over a million accountants and auditors employed in the U.S. Given these figures, it's not difficult to understand why many entrepreneurs are on a lookout for buying a CPA firm.
Similarly, law firms in the U.S. are part of a $283 billion industry. With the advancement of technology, both industries are seeing an increasing number of successful ventures online. Whether for business or personal purposes, almost everyone requires the help of a legal or accounting business.
With a formal education and training, anyone can enter a legal or accounting profession and set up a new venture. However, buying an existing business offers a quicker and better launch pad.
Questions to Ask Yourself When Buying a CPA Firm
- What should your practice look like in the next three years to make you happy? Maybe you can visualize yourself having purchased a CPA firm and talking about your practice with your friend three years down the line. Such visualization can help you understand a lot of things about your practice.
- What are your strengths? You can include both your professional expertise and personal traits, which will be helpful in driving your business.
- What are your weaknesses? You should know your weaknesses in order to overcome them or find a workaround. For instance, you can consider hiring someone to help in an area where you lack skills.
- Are you willing to relocate? Discuss with your family and focus on finding a firm only in areas you can relocate to. It will save you a lot of time as compared to negotiating with accounting firms all over the country.
- Are there any deal breakers? What factors are outright unacceptable to you? For example, you may not want to enter into an unfamiliar niche or buy a practice with too many employees.
- How would you describe your ideal client? Buying a practice with the clientele of your choice will have a huge impact on your client retention, satisfaction, and success.
- What type of fee structure do you want? Would you like to buy a firm that charges very low fees? If you are confident in raising the fees without much difficulty, buying a firm that undervalues its services can be a bargain for you. However, you must analyze the clients carefully in order to make the right assessment.
- How much can you invest? Although you can avail of bank finance, you will need to make some down payment for your acquisition. You should be able to meet at least 10 percent of the purchase price.
- What's the optimal size of practice for you? Usually, a practice that generates a good cash flow is considered a good buy.
- How will you transition the business? What kind of help will you need from the seller?
Cloud accounting is the latest trend in the accounting industry. A growing number of accountants are moving their clients onto cloud accounting applications for higher productivity, security, and several other benefits. Modern accounting businesses are moving away from papers and binders toward a paperless office and cloud accounting goes hand in hand with this objective.
Unfortunately, most of the accounting businesses are still stuck in the 70s when it comes to marketing their services. Using online marketing platforms can heavily benefit accounting businesses when it comes to acquiring new clients in a cost-effective manner. This is especially the case because when clients search for a new accountant, most of them do it online.
Approaching Prospective Clients
Attracting new clients is like making new friends. It doesn't happen in one meeting.
Before you go searching for new clients, consider taking the following two steps:
- Be absolutely clear about the type of clients you are looking for.
- Determine the methods needed to attract the attention of your ideal clients.
If you need help to buy accounting business, you can post your legal need on UpCounsel's marketplace. UpCounsel accepts only the top 5 percent of lawyers to its site. Lawyers on UpCounsel come from law schools such as Harvard Law and Yale Law and average 14 years of legal experience, including work with or on behalf of companies like Google, Menlo Ventures, and Airbnb.