Scaling your accountancy or bookkeeping practice is the key to creating a firm that has a long-term future and stable revenues. But what are the challenges you’ll face along the way? And what are the important elements to get right when you’re looking to scale up?
Growing your firm at pace won't be a walk in the park. It will mean change, upheaval and new systems, plus hiring and re-training the key people in your team. But if you're going to evolve as a firm then there’s an imperative to scale up and take the next step in your development.
So here are 8 key tips for scaling your accountancy or bookkeeping practice.
1. Have a plan and a vision for your firm
Having a clear vision and plan behind your growth aspirations gives you a set of values and a route map to guide your journey – after all, as the old saying goes, ‘Fail to plan, plan to fail’.
Having a future plan for the practice, setting clear goals and objectives and measuring the firm's performance against these goals puts some real drive behind your growth. Paul Bulpitt and his co-founder, Peter Czapp, set up The Wow Company in 2004, and Paul’s clear that having a high-level vision for the business was critical.
“The areas that were the most important in our original plan were the conceptual bits – the vision of creating a beautiful business and it not being dependent on the two of us, with the aim of doing something really special for small businesses.
It’s the vision and purpose that’s really endured. So in terms of the original spreadsheets and numbers we had in the plan, it changed immeasurably over time. But the ‘Why’ of the business and the purpose at the centre haven’t changed – and that vision is what’s guided us.”
2. Think like a business owner and systemise
To scale, you need to think like an entrepreneur. Many smaller accounting and bookkeeping firms come into being when an experienced finance professional decides to set up on their own – and by doing so, they create a means to earn an income from their professional skills.
But this approach fails generally fails to see the bigger potential of the firm as a business model – a model with the ability to grow, evolve and scale into something independent of the founders. For Paul and Peter, their approach was to think of their firm as a business from the start.
“There were two really key things we had in place from the outset. Number 1 was to have a plan that wasn’t just to replace mine and Peter’s income – that was never the goal.
Number 2 is that we set The Wow Company up as a business, not as an accounting firm. Our goal was always that the business wasn’t dependent on us – Peter and me. So we always aimed to be a business first and foremost, with a sales function, time and resources that were dedicated to marketing and this aim of not setting up like a traditional accounting firm.”
To make scaling work, it’s important to think like a business owner – and to set up as a business first and foremost, with the structures, systems and roles needed for your business model.
3. Don’t do it alone – share the workload
Scaling up isn’t an instant process, and it takes time, effort and hard work to drive the firm in the right direction. So having a partner and collaborator to work alongside can be a real boost when you’re facing a long list of challenges to overcome, as Paul points out.
“Growing the firm is hard! Hard, difficult, slow and expensive. So it’s invaluable to have a right-hand person to share the workload and to bounce ideas off. And get them on board sooner rather than later so you can both shoulder the burden.
Also, be aware that your personal income will shrink. It probably took 5 or 6 years for us to get back to a position where our income was the same as in our previous roles. So if you’ve come from a job with a decent salary, you might have to take that hit to your income for a few years. The money’s going to be going into the business and there will be less in your pocket.”
4. Use software to increase efficiency
Cloud software has changed the accounting landscape beyond recognition in the past decade, bringing flexible online accounting, fintech apps, software automation and artificial intelligence to even the smallest accountancy and bookkeeping firms.
To create the efficiencies needed to scale up, it’s important to embrace this technology. Systemise the firm, set yourself up with an online accounting platform and integrate with the associated apps that can bring automation and productivity to your processes. For Paul, the tech has been a real driver in The Wow Company’s growth.
“It’s a no-brainer to have Xero for the accounts and apps like GoCardless and Receipt Bank providing a platform that we can operate from as a business. The time and efficiency savings of having something like GoCardless to collect our fees automatically is insane – we’d probably have grown more quickly and earlier if we’d had Xero and Receipt Bank etc. in place sooner. “
If you can automate your key processes, then everything happens a lot faster and with less input from your people. Everything’s being checked, the algorithms don’t go on holiday or call in sick, so you instantly increase your efficiency.”
5. Get the right people on your team
When you and your co-founders start out, you’re the face, the workforce and the brand of the firm. But as the practice grows, you need to take on more people – and it’s vital for your new employees to deliver the same vision and the same level of customer service.
For Paul, having the right people on board was crucial to their success, while also being one of the biggest hurdles they faced as a practice.
“The people side is the hardest bit of growing, but it’s also the most rewarding bit in many ways. The people that we hire now are far more talented, skilled and knowledgeable than we are. It’s difficult to see that from day one, but further down the line you realise how important having a skilled team is.”
To create that ideal team, look for talented people who share your values and vision, and have the tech skills needed to work in a modern digital practice
6. Take your culture seriously
Supporting the growth of your people is vital. To scale, you need the best talent, but it’s also equally important to create a culture and value set that support the growth of your team.
So it’s vital to have a hiring plan in place and to make sure you’re developing, training and supporting your team to create a culture that gets the very best from them.
“For us, the people element was the biggest challenge. Hiring people, retaining people and training people were all key hurdles. But a scalable firm is all about people – so you absolutely need the right people on board. When your purpose is to have a positive impact for small businesses your vision has to be central to your firm culture.”
7. Work with the right clients
Be clear about the kinds of clients you want to work with. If you’re trying to service business clients who don’t share your firm’s mindset, or don’t appreciate your vision for adding value, that will hold back the growth potential of the practice.
Bad clients eat into your time, don’t bring in the best revenues and distract you from the gold-standard clients who will help you move the practice forwards.
“Getting rid of the ‘wrong’ clients can actually be quite a wholesome exercise. If those clients aren’t right and don’t share your vision, you’re not going to be able to build a business that’s right for them. So losing those clients is a really liberating thing.
The Wow Company sold off 20% of our client base in 2010, and it felt very scary. But, with the benefit of hindsight, it’s hands-down the best thing that we did.”
8. Market the firm to the most valuable audiences
When you know your ideal client type, that makes it far easier to market your firm effectively – and that helps you attract and retain the businesses that add the most value for the firm.
Paul and Peter have always realised the importance of marketing The Wow Company, and having a clear focus on their preferred client types has helped them hugely.
“We’re pretty granular with our marketing and targeting now. Once we’d realised that creative agencies were a key client group for us, that helped us find the audience who shared our mindset. We now focus a chunk of our campaigns and marketing spend on valuable content for them, like our BenchPress 2018 report for agencies.”
Define your vision, hire the right people and embrace the tech
Big ambitions take big effort to achieve, But with the right planning there's never been a better time to scale your firm.
- Have a plan and a vision for the firm – know WHY you’re in business
- Think like a business owner – set up the firm as a business first and foremost
- Don’t do it alone – have a right-hand person to share the journey
- Use software to increase efficiency – make the most of automation in apps
- Get the right people on your team – look for talented people who share your vision
- Take your culture seriously – have a hiring plan and develop your people
- Work with the right clients – target the best clients, and lose the bad clients
- Market the firm to the most valuable audiences – and increase engagement
By having a clear growth plan, systemising your processes and applying the time-saving and automation features of modern software, it's a challenge that your firm can meet.
About the Author: Steve Ash is a specialist in accounting, marketing, business software and fintech apps.