How to start your own accounting firm: A guide for solo accountants
The first step would be to decide on what services you would provide. Will you focus on bookkeeping & accounting, tax preparation, or provide advisory services? This clarity will help clear a lot of things in the initial phase. It is good to be a jack of all trades, but even better to be a master of a select few. Many solo accountants succeed by narrowing down their focus, either on a set of services or specific industries. By choosing a niche, you get to quickly position yourself as a specialist in that domain which helps you attract the right clients and grow successfully.
1. Set your scope of services
The first step would be to decide on what services you would provide. Will you focus on bookkeeping & accounting, tax preparation, or provide advisory services? This clarity will help clear a lot of things in the initial phase. It is good to be a jack of all trades, but even better to be a master of a select few. Many solo accountants succeed by narrowing down their focus, either on a set of services or specific industries. By choosing a niche, you get to quickly position yourself as a specialist in that domain which helps you attract the right clients and grow successfully.
2. Ensure legal requirements are addressed
If you are starting a new business, it is mandatory to meet the legal requirements in the region you are starting your business. Starting an accounting firm is no different. If you are a CPA, ensure your license is active. If you have decided to offer tax services, you might need to meet certain requirements depending on your country. For example, you would need a PTIN if you are offering tax services in the US. Similarly, you should be registered for GST if you are providing services in India. Ensure you are protected with professional liability insurance. Joining your local accounting bodies and organizations like AICPA, ICB, ICAI builds credibility and provides you access to valuable resources, too.
3. Set up your operations
Even as a solo accountant, professional systems matter. You need to decide if you will be a virtual firm, have a small home-office, or use a hybrid model. Build a proper process checklist that covers operations like client onboarding, monthly bookkeeping, tax deadlines, and the like. Ensure you set up periodic meetings with your clients during the initial phase instead of meeting them only during the tax season. When you see your hands are getting full, be smart and outsource activities like marketing, sales, and other tasks.
4. Fix your pricing model
Landing on the right pricing strategy is hard. Accounting firms use different pricing models to accommodate client needs. While hourly billing is very common, fixed retainers or monthly packages offer their own benefits in terms of providing better stability and longevity of client projects. Another popular approach is value-based pricing, where fees are tied to the perceived benefits delivered to the client. Choose the right pricing model depending on your service scope. Always be upfront with pricing to avoid later surprises.
5. Build your tech stack
When you are a solo accounting firm, having the right tech stack plays a huge role on your efficiency and, thereby, success. Having a robust and well integrated tech stack compensates for the lack of staff. Accounting solutions like Zoho Books handle manual tasks like data entry, invoicing, and client reminders freeing up your time to focus on offering better services to your clients. As you scale, you would need a practice management software like Zoho Practice to manage everything from client onboarding to financial analysis. By choosing the right tech stack, solo accounting firms can go a long way in delivering exceptional client services.
6. Market and take your firm to the world
Once you have the basics covered, the next step would be to market your services to the world. Getting the first set of clients can be tricky. The best place to start would be your own network. There is no more powerful marketing than word of mouth. In parallel, create a professional looking website where you can showcase your portfolio of services clearly. Create your Google My Business listing so you show up on local searches. Leverage content marketing and SEO to highlight your expertise. Consider hiring a freelancer or consultant to set this up for you if you are not sure how to go about it. Join your local accounting bodies where you can expand your network by meeting your peers and prospective clients.
Final thoughts
Running a solo accounting firm offers significant rewards, but it also comes with its own challenges. Starting your own accounting firm may feel like a herculean task, but with the right technology, plan, and guidance, it's achievable. Solo accounting firms with the right foundation can go on to become larger practices in the future.
Ultimately, success as a solo accountant hinges on continuous learning, adaptability, strategic use of technology, and a steadfast focus on building trust and delivering exceptional value to clients, ensuring both professional growth and personal fulfillment.