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Building a Scalable Accounting Firm: A Q&A on Growth Strategies for Accountants

Strategic business planning is a difficult skill to master for any entrepreneur, and this is something many of my firm’s clients and accounting firm entrepreneurs are actively working on.

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By Sarah Acton.

Growth is often top of mind for accounting firm leaders, but what does sustainable growth actually look like in practice? In this Q&A, I asked Jason Blumer, CPA to discuss firm growth and what firms truly need to be able to scale and succeed. 

Jason knows a thing or two about firm growth and innovation: after originally taking over his father’s accounting firm, he is now the CEO of Blumer CPAs, an experimental CPA firm, and founder and CEO of Thriveal CPA Network, a community for accounting firm entrepreneurs looking to grow.

In my role at BILL, I have the opportunity to talk to accounting firms from across the country about the internal and external pressures they face.  Increasingly, I’m hearing from firms that are leaning into growth areas and innovation opportunities to help set themselves apart from the competition. With a solid plan in place, firm growth can become less daunting and instead be a viable part of a successful business strategy.

In this Q&A with Jason, we discussed the main considerations for leaders looking to accelerate their firms: what growth looks like, the kinds of proactive changes to make, and strategies that contribute to success. 

What are some of the biggest challenges firms are facing when it comes to growth?  How do factors like market drivers and trends affect these?

Firms are encountering pricing issues when trying to compete with large service providers and offshore/overseas teams for commodity services (tax, accounting, payroll, etc.). In these instances, it can be difficult to balance profit margins and competitive advantage — no one wants to be in a race to the bottom.

The other top-of-mind challenge at this time is the labor shortage. We are seeing younger generations less willing to participate in traditional tax seasons like older providers have participated in their past. Because of this, clients are finding the prices substantially increasing or accountants and tax providers unable to take on new clients. 

How would you grade firms on business planning based on what you’ve seen? What areas of business planning do firms excel at, and what areas need more attention? 

Strategic business planning is a difficult skill to master for any entrepreneur, and this is something many of my firm’s clients and accounting firm entrepreneurs are actively working on. 

A key part of this is understanding how to restructure teams as they grow larger. This is a majority of our work when we consult with larger firms. We are typically helping them overcome poor planning around building a team and also identifying when their current team structure is no longer effective for their size. As a firm increases the size of its teams, there is a need to restructure to better manage the flow of knowledge and service through the growing organization.

A firm’s growth has stalled. How can they jump start growth again? 

This may seem counterintuitive (and maybe a little controversial), but a poorly planned client base is often the reason a firm is stalled — and sometimes, a firm needs to eliminate a portion of their client base in order to grow. 

Here’s how it looks: disparate clients come into a firm and have no common niche or market relation. All of these clients need to be served in different ways, so teams are required to become broad generalists. As the firm continues to grow, pricing is often overlooked and clients pay commodity prices, thus failing to give funding to the firm to hire a more specialized team and lay roots in the market they want to be in.

To offset this situation, it’s important to eliminate a poorly built client base to give room for the firm to price higher and begin focusing on fewer clients. As the firm increases their ability to provide more specialized services and to onboard clients at higher prices, their funding will grow. This gives the firm more flexibility to determine which clients they will take and at what prices. 

How important is training for both teams and leaders?

Training is extremely important at any level, and this is actually one of the signs of a highly valuable and competitive firm. Finding the time and resources to train employees can be difficult, but firms that are able to set up training structures for their teams are able to ensure their teams are always learning.

Similarly, leaders need to be involved less in the service of the clients over time and more focused on firm expansion. For this reason, firm owners need to be in communities, attending modern and forward-thinking conferences regularly, and learning from other firm entrepreneurs about best practices.

I recently created a new training course with BILL, the Accounting Firm Growth Masterclass, that may be of interest to firms looking for training opportunities specific to growth and scalability.

Where does technology fit into growth strategies and why?

Technology is the backbone of a strong firm. Firms have to be adept at knowledge management and technical service delivery, and they cannot grow effectively unless they are choosing and using tech solutions to make their work more efficient. This is an essential part of our training programs for our teams: how technology can allow us to be more efficient in our service. 

The choices that a firm makes when it comes to technology are a strategic component of their overall business strategy. The solutions in our tech stack allow us to remain focused and efficient as we serve our clients and look for new growth opportunities. Switching software often — especially as the firm becomes larger — can confuse teams and really slow down their work. 

A lot of firms have a tough time with pricing–how much things should cost, how to bill (hourly, etc.)? What are some baseline steps they can take in making pricing decisions?

There is a difference between billing and pricing — and pricing is more of a universal struggle for firms. Billing is done after a service is performed. Firms perform work, track their time, and then send a bill for the time spent. Pricing is where you negotiate the agreed cost for a service up front before it is performed. The difficulty that firms encounter with pricing is determining what their rate should be — there is no magic formula for coming up with the perfect price. 

While hourly billing is a simple calculation (the hourly rate times the number of hours put into the service), pricing is based upon a customer’s perceived value at that time and is more of a negotiation. In order to price successfully, firms need to employ negotiation and value-based alignment techniques in order to come to a price that both the firm and the customer agree to.

Suppose a firm is interested in launching a new service. What is your advice to them? What are steps they can take that will help them be successful? 

New services are some of the greatest innovations firm owners can practice. These new services potentially allow for the highest perception of value (and thus, price) and can truly differentiate a firm in their market. 

My firm launches one to two new services in our firm per year. Before launching the service, we have a couple of considerations. The first is determining how we will market and sell this service. If the service is truly innovative, it will need to be marketed to the public, beyond current clients. It will take time to spread the word and have meetings with new potential buyers to understand the service. Normally the owner takes on this work. 

The other consideration is who will perform this work. New services are often some higher value advisory offering, and thus the owner will usually have to take on this work as well. As your firm grows larger, it will be important to create new services that the team can perform without putting all the onus on the owner. 


By Sarah Acton is Chief Marketing Officer at BILL