You are an accountant with years of experience having an accounting firm that gets by. You dream of growing it into a flourishing business. You have tried every trick under the sun to level up your company from struggling with how to grow an accounting firm to an exceptional one. Yet, you haven’t moved the needle much. If this situation resonates with you, my friend, you're in the right place. You may be wondering what you are doing wrong. Probably nothing, probably everything. You can sit and conduct a detailed postmortem, but what you really need is a vision to build the future.
In this article, we will provide you with 11 tips that you can implement right away to grow your accounting firm. With each tip, you'll gain a new perspective on growth strategies. Ready to scale your business to heights? Let us start.
Competitive Landscape Of The Accounting Industry
The accounting industry has been undergoing significant transformations in recent years, propelled by technological advancements, changing client expectations, and evolving market landscapes. Understanding the competitive dynamics within this sector is crucial when trying to understand how to grow your accounting firm.
Globalization has opened doors for firms to expand internationally, leading to increased competition. 85% of accountants believe that the profession in their country needs to pick up the pace of technology adoption to remain competitive internationally. Conversely, consolidation trends, where larger firms acquire smaller ones, have also altered the competitive landscape.
Further, clients now expect more than just number crunching. They seek strategic advice, real-time analytics, and personalized solutions. According to a survey from Xero, 39% of millennials are seeking an advisor that’s “enjoyable” to work with.
Standing out in a crowded marketplace is imperative. Successful firms leverage their unique selling propositions, whether it's expertise in a particular industry or a reputation for innovation and forward-thinking. Nearly 40% of all firms said they were either innovators or early adopters of technology. From these statistics, we can understand how the competitive landscape of the accounting industry is getting ever in the days ahead.
Why Is Growth Important For Sustainability And Profitability?
Growth is not merely about expanding the client base or increasing revenue, it's a fundamental driver that underpins the long-term sustainability, profitability, and resilience of accounting firms in a dynamic and competitive landscape.
Consistent growth is pivotal for the sustainability and profitability of accounting firms, yet the seasonal nature of this industry often creates a feeling of constant motion without significant progress. However, establishing predictable growth is key in an accounting firm growth strategy.
Predictability in growth isn't just a sign of sustainability; it's a strategic advantage that allows for meticulous planning and confident decision-making. Anticipating client numbers in the short and long term empowers you to plan to staff, enhance client satisfaction, and make impactful strategic choices. Clients appreciate and return to stable firms, drawn by the reliability and responsiveness they offer.
Technology is a driving force behind this predictability. Business software automates marketing, streamlines operations, and amplifies client management. This digital transformation empowers savvy marketing decisions, operational efficiency, and improved client service through streamlined workflows and CRM tools.
Sustainability and growth demands focus on key areas: envisioning the firm's direction, nurturing client relationships, managing resources effectively, relying on data for decisions, and optimizing financial and marketing strategies.
Why Do Some Firms Grow Faster Than Others?
Accounting firms' growth rates often vary due to a combination of factors, distinguishing those that accelerate from those that lag behind. Here are some of the major factors influencing how to grow an accounting firm.
Client Acquisition and Retention:
Firms that excel in both acquiring new clients and retaining existing ones tend to grow faster. This dual focus ensures a continuous inflow of business while building long-term relationships that fuel sustained growth.
Niche and Specialization:
Firms carving a niche or specializing in specific industries or services often experience accelerated growth. This specialization sets them apart, attracting clients seeking tailored expertise, which translates to a loyal client base and amplified growth opportunities.
Technology Adoption:
The pace of an accounting firm's growth strategy is significantly influenced by a firm's embrace of technology. Rapidly growing firms tend to adopt cutting-edge tools and systems, leveraging automation, cloud solutions, and data analytics to enhance efficiency, service delivery, and client experience.
Client-Centric Approach:
Prioritizing clients' evolving needs and expectations distinguishes high-growth firms that know how to grow an accounting firm. A client-centric business ensures personalized service, responsiveness, and proactive problem-solving, cementing client relationships and driving referrals, ultimately accelerating growth.
Agility and Innovation:
Firms with a culture of agility and innovation adapt swiftly to market changes, staying ahead of competitors. Their ability to evolve services, adopt new strategies, and innovate in response to industry shifts fuels faster growth trajectories.
11 Tips On How to Grow An Accounting Firm
It is no secret that the accounting sector is a highly competitive one. In the US, there are 46,000+ accounting firms providing both opportunities to people and competition to business. So, instead of mulling over what went wrong earlier, it is high time you understand the competitive nature of this field and understand how to grow an accounting firm and implement the strategies that are still relevant in 2023.
Here are the best ways to go about it.
- Do a SWOT analysis
Gaining an understanding of what you're really good at (Strengths), where you might need some improvement (Weaknesses), spotting opportunities in the market (Opportunities), and being aware of potential challenges (Threats) is what SWOT analysis is about. Conducting a SWOT analysis for your accounting firm gives your business a detailed check-up.
You can begin by identifying your strengths. This could be your experienced team, excellent client relationships, or specialized services. Then, look at your weaknesses - maybe it's outdated software or a lack of specific expertise. Now formulate plans to avoid your weaknesses and to take advantage of your strengths.
While creating a plan for how to grow an accounting practice, leave room for opportunities and threats. Opportunities for accounting firms can be expanding into new markets or offering services that are in high demand. For instance, you could pivot from providing accounting services in India to startups that cater to the U.S. market.
And watch out for threats - things like new competitors or changes in regulations that could impact your business.
SWOT analysis can help you answer this crucial question - with the resources, software, and technology we possess, and the team we have, who can we better serve? Answering this question will help you find and attract your Ideal customer profile and cater to their needs ultimately leading to your firm’s growth.
- Devise a growth strategy
Once you are done with your SWOT analysis, you will know what to expect in the business landscape. Use this as a jumping board to make plans for the future. Devising a growth strategy for your accounting firm should include details like how to expand your client base and what new sources of revenue you can tap into.
You can simply answer these three questions to understand how to grow your accounting practice:
What sets your firm apart from your competitors? This could be specialized expertise, exceptional client service, or a unique approach.
Are there any opportunities to expand your services to new industries or offer more services to your current clients? If yes, how can you do it?
Are there any emerging technologies or changing regulations that could impact your services or create new opportunities? Look at trends in the accounting industry. Check if these trends will help you position your firm to adapt and thrive in a dynamic market.
Finally, set clear goals and timelines for your growth strategy. If you do not achieve it within the time frame, you can always adjust it later.
Protip: It is important to continuously reassess your growth strategy. Stay open to refining your approach based on market shifts, client feedback, and emerging opportunities.
- Leverage Technology for Growing Your Accounting Firm
Technology isn't just a tool, it's the answer to the question - how to grow your accounting firm. By adopting the right technology, you can stand out and supercharge your services.
For example, here are some of the must-have software you can use.
Accounting Software:
Getting the help of an accounting software simplifies many of the mundane tasks, that can free up room for other important things when you are trying to grow your accounting firm.
- QuickBooks: QuickBooks simplifies bookkeeping, automates invoicing, tracks expenses, and generates insightful financial reports, making it a go-to choice for businesses of varying sizes.
- Xero: Xero stands out as a cloud-based accounting solution that offers real-time data accessibility, invoicing capabilities, and intuitive bank reconciliation, making it an ideal choice for businesses seeking efficient and collaborative financial management.
Protip: If you are confused about what to choose between Xero and Quickbooks, check out this detailed article.
- FreshBooks: Geared toward small businesses, FreshBooks is a user-friendly cloud accounting that streamlines invoicing, expense tracking, and time management, offering a simple interface for managing financial tasks for small business owners.
Client Relationship Management (CRM) Software:
- HubSpot CRM: HubSpot CRM offers features for managing sales pipelines, automating tasks, and providing insights into customer behavior, enhancing overall client relationship management.
- Zoho CRM: Zoho CRM is a comprehensive system known for its automation capabilities and analytics tools. It allows for efficient lead management, automates sales processes, and provides in-depth analytics to optimize customer interactions and improve business strategies.
Proposal Software:
Proposal management software simplifies the creation, customization, and tracking of proposals. Choosing the perfect proposal software is an essential part of an accounting firm’s growth strategy.
- Cone: Cone offers a proposal and billing software purpose built for accountants and bookkeepers. It streamlines the proposal creation process, offering templates, e-signature functionality, invoicing and payment features, making it a valuable tool for efficient client engagement and securing business deals.
Distinctive Features:
- CRM and sales pipeline management.
- Flexible editor to build proposals to meet any needs.
- Automated Invoicing eliminates the risk of missing invoices.
- Seamless payment experience with extensive payment options, including direct debits, credit and debit cards, and ACH payment methods.
- Robust billing software.
- Automated renewal processes.
- Integrations with accounting software.
Price:
Paid plans start at 10$ per user/month - unto 90% savings compared to the accounting proposal software available on market. Additional user add-on: 5$. Try for free.
It's the best choice when it comes to the price and value it offers.
Plans:
Essential
10$ per user/month
Growth
8$ per user/month(5 users minimum)
6$ per user/month(10 users minimum)
- GoProposal: GoProposal simplifies proposal creation and customization while offering features for pricing, project scope, and client communication. It aims to streamline the proposal process for accounting professionals, ensuring clarity and professionalism in client interactions.
Distinctive features:
- Creation of Powerful persuasive Proposals
- Availability of Letters of Engagement feature
- Full Branding Suite
- Powerful Integrations with accounting platforms like Xero
Price: Starting at ~ $76.85 US/month for up to 5 proposals.
- BetterProposals: BetterProposals focuses on creating visually appealing proposals with interactive elements, enabling accountants and bookkeepers to showcase their services effectively. It provides analytics to track proposal engagement and optimize conversion rates, enhancing the overall proposal experience for clients.
Distinctive features:
- Customizable templates
- Small business focused
- User-friendly interface
- Integration with other tools
Price: Starting from $19 per month for the basic plan and going up to $49 per month for the enterprise plan.
If you want to explore more alternatives for Proposal and Billing Software, learn here.
Ready to Take Action?
Make Cone your go-to proposal and billing software. Elevate your client engagement, secure business deals efficiently, and experience unparalleled growth. Take the first step toward success by choosing Cone today. Sign up now!.
Practice Management Software:
Practice management software is a centralized tool tailored for accounting professionals, facilitating streamlined organization, task management, and client communication to efficiently run and grow an accounting practice. Here are some of the best practice management software.
If you practice in UK, explore the best alternatives for accounting practice management software in UK.
- Cone: Cone’s practice management software is designed specifically for accountants and bookkeepers. It centralizes tasks, project management, and client communication, offering a streamlined platform to efficiently manage various aspects of accounting practice.
- Karbon: Karbon is a collaborative platform that integrates workflow automation, communication tools, and task management. It focuses on enhancing team collaboration, project management, and streamlining workflows to boost productivity within accounting practices.
- Accountancy Manager: This software streamlines client communication, task management, and compliance processes for accounting firms. It offers features for managing client records, deadlines, and document sharing, simplifying practice management tasks that can be a crucial part of an accounting firm’s growth strategy.
- Senta: Senta is a practice management tool designed to automate administrative tasks, manage client databases, and streamline workflows. It enables accountants to automate repetitive tasks, customize client communication, and track deadlines efficiently.
- Canopy: Canopy is known for its robust tax resolution and practice management solutions. It assists in managing client data, IRS compliance, document storage, and workflow automation, catering to tax professionals' specific needs.
1. No separate Proposal Software
Send proposals from the same platform where you manage your projects. No more brittle integrations.
2. Includes automations, email management, billing
Manage everything you need in one place, for less.
3. White-glove support, free migration
We'll help you move from your old system to ours, for free.
4. Fraction the cost of other alternatives
Save up to 90% on software costs.
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4. Focus on marketing and branding
One piece of advice for you from our side - Leverage the power of marketing. Sure, accounting firms have certain restrictions when it comes to advertising. But there’s no rule that states you cannot market your business by making yourself an online brand.
So to understand how to promote an accounting firm, first, you need to have a strong online presence to build credibility. Branding goes beyond just logos and colors - it's about creating a consistent image and reputation. Create a profile for your business and also get active on platforms like LinkedIn to share professional stories. Keep your uniqueness consistent in all your content, whether it's through emails or social media posts.
Also, a professional website is your digital business card. It's where potential clients are redirected to learn about your services, your team, and your approach. So this website needs to be convincing and catchy. You can create a well-crafted website using WordPress and Wix sites. Even if you are a beginner, you can use the drag-and-drop feature or upload free themes like Astra on these sites to build your site. Easy-to-navigate websites that speak volumes about your firm have a high potential to convert visitors into clients.
Learn about 15 top marketing strategies on how to grow an accounting firm here.
5. Hiring and retaining top talent
When it comes to building a stellar team and how to scale an accounting firm, you've got to do a couple of key things right. Platforms like LinkedIn, Glassdoor, and Indeed are your go-to places for posting job openings. These platforms have extensive networks of professionals seeking new opportunities. You could also use referrals to tap into existing networks.
It's not just about bringing people in; you've got to keep them happy too. Of course, offering competitive salaries is a no-brainer to stay attractive in the job market. But it's not all about the money in the long run. As a growing accounting firm owner, you need to create chances for these employees to grow professionally. You can host training programs, certifications, and mentorships to guide them. A great way is to help your employees upskill by offering to pay for their education. In the long run, your investment will pay off.
Now, to make sure you're on the right track, it's smart to do those regular check-ins with your team. Employee surveys are gold mines for feedback. This way you'll increase the chances of retaining top talents and ensuring your accounting firm's long-term success.
Protip: Encourage professional development by investing in ongoing training, certifications, and mentorship programs. Employees value opportunities to enhance their skills, and a supportive learning environment fosters loyalty and drives long-term commitment to your firm.
6. Redefine your pricing strategy
Redefining your pricing strategy is a critical step for growing your accounting firm. First, consider adopting a value-based pricing approach. Instead of charging by the hour, base your fees on the value you provide to clients. This means you can charge more for specialized services or solving complex financial problems, which can significantly increase your revenue.
Another effective strategy is implementing a subscription model. Offer clients ongoing accounting services for a monthly or quarterly fee. The benefit of this practice is that you'll have a stable income stream for your firm and you'll build strong, long-term relationships with your clients.
Managing all these payments can be a bit overwhelming when you focus on how to grow an accounting firm. That’s where software such as Cone’s proposal to payment software can lend a helping hand to help streamline pricing and do value-based pricing easily.
7. Optimize internal processes and reassess operational efficiency
Optimizing internal processes is like fine-tuning the engine of a well-oiled machine. So, step one: evaluate how your firm operates. Hunt down any slow spots or any bottlenecks or inefficiencies in your workflow. Are there repetitive tasks that can be automated through software or systems? This isn't just about saving time – it's an essential move against errors, which, in accounting, is a big deal.
Continuously reassessing your operational efficiency is key to staying competitive in an industry that's always highly dynamic. You know, tech upgrades, new rules to follow, and clients who keep raising the bar. When you keep tabs on how things are running, you're ready to tackle any curveball that comes your way. In the grand scheme of things, this commitment isn't just a nice touch—it's a game-changer.
This ongoing commitment to improvement can lead to increased creation of the best accounting firm growth strategy, client satisfaction, better employee morale, and ultimately, sustainable growth for your accounting firm.
8. Offer free resources
The power of sharing free resources is not something to be taken for granted. Your firm can show off its expertise in accounting and finance by creating and sharing high-quality content such as insightful blog posts, webinars, and e-books. This can establish your firm as a thought leader and attract potential clients and create new opportunities for your accounting firm.
You can give away these resources on your firm's website, blog, social media platforms, email newsletters, and industry forums. These free resources can be offered to your ideal audience in return for their email address or number. Now, with this, you can create an email list or WhatsApp community to share insights and subtly promote your accounting firm.
If your firm specializes in certain areas of accounting or finance, focus your free resources on those niches. This helps you attract a more targeted audience interested in the specific services you excel in.
9. Collaborate with other professionals
As a single firm, you can do so much. To scale your business to new heights you need to look for individuals or firms with a similar level of expertise, reputation, and professionalism. Over time you can build relationships with financial advisors, and other professionals who can refer clients to your firm for accounting services and help you grow your accounting firm.
These professionals could be someone you meet in your real life or online. The best place to look for professionals online is job platforms such as LinkedIn, Indeed etc.,.There are also several Facebook groups dedicated to accountants. From the platforms, reach out to potential collaborators with a personalized message. Explain your interest in collaboration, why you think it would be beneficial, and how it aligns with both parties' goals. Once there's mutual interest, set up a meeting or call to discuss the collaboration in detail.
If the collaboration is finalized, you can promote the collaboration across both parties' platforms. Utilize social media, email newsletters, websites, and any other relevant channels to maximize visibility. Finally, reflect by asking these questions - What worked well? What could be improved? What more can you bring to the table? Use these insights to enhance future collaborations and make them even more successful.
Pro Tip: Prioritize relationship-building over transactional partnerships. Invest time in understanding potential collaborators' needs and aligning mutual goals. Regularly evaluate and communicate to refine the partnership, ensuring both parties continuously benefit and evolve together.
10. Client referrals
One of the oldest methods in the handbook of growing an accounting firm is client referrals. Referrals come from satisfied clients who have experienced the quality of your services firsthand. Positive experiences shared by your clients lead to word-of-mouth amplification. A single satisfied client can refer multiple potential clients, creating a ripple effect of new business opportunities.
Ultimately, Referral-based growth can also significantly reduce marketing costs. Instead of investing heavily in advertising and outreach, this lets you tap into your existing client base to generate new business.
Asking a client for referrals requires a thoughtful approach. Select a time when your client is satisfied with your services. Use a soft and not-so-pushy language. For instance, you could say, "We hope our accounting firm has provided you with a great service. So do refer us in case anyone needs accounting services". You can also offer a small incentive, such as a discount on their next service or a small gift, to show your appreciation for their referral efforts.
11. Invest in training and education
Every strategy we have discussed above talks about improving your business and process. But every firm thrives because of the people in it. Great people bring great success. So it is important to ensure your team is well-trained and up-to-date with the latest industry trends.
What can you do as an accounting firm owner to train your team? You can organize regular workshops and seminars on topics relevant to accounting, taxation, auditing, software usage, and other industry-specific subjects. Pair new employees with experienced team members who can mentor them. You can invest in taking a subscription for the whole office in an online learning platform like Udemy or Coursera. There are “n” a number of ways in which you can help your team to upskill themselves.
A well-trained team stands out in a competitive market and has huge opportunities for accounting firms. Talented professionals are more likely to join and stay with a firm that invests in their growth.
Take Control
How to grow an accounting firm? This question does not have to be hard as long as you’re smart about it and consistent in your efforts. Each strategy—whether it's leveraging technology, refining your pricing approach, building client relationships, or collaborating with industry professionals—contributes to a holistic approach to scaling your accounting firm.
If you put these strategies into action and stick with them, you're setting your accounting firm up for success. Over time, you can turn your accounting firm into a more prominent business. In short, consistency is key. Test the waters, see what clicks for your firm, and then gloat about your accounting firm’s success!
Frequently Asked Questions
Here are some of the commonly asked questions.
- How do you grow an accounting firm?
To grow an accounting firm, focus on client satisfaction, offer niche services, adopt technology. Leveraging digital marketing, networking, establishing a social media presence, listing on review sites, attending events and webinars will help in enhancing visibility and growing your revenue.
- How fast do accounting firms grow?
Growth rates vary widely based on strategies, market conditions, and client acquisition. Some firms experience gradual growth, while others might expand rapidly due to a strong client base and service diversity.
- How can I improve my accounting business?
Elevate service quality, diversify your client portfolio, leverage cutting-edge technology, and invest in robust marketing efforts to strengthen and expand your accounting business.
- What are the four components of CPA firm growth?
Client retention, specialization, effective marketing, and technological advancement form the pillars driving growth for CPA firms.