Now is a Great Time to Start Your Own Practice
Since May, I have traveled across the country, speaking and visiting many accounting firms, and have come to the conclusion that now is one of the better times to start an accounting or bookkeeping practice.
The entrepreneurial spirit is alive and well across the United States. According to the State of the American Entrepreneur Report from Fast Company, there are more than 500,000 businesses started every year; these companies need accountants to guide them down the path of success. Every business needs accounting and tax advice. They also need advisory services and compliance needs, which is why the opportunity is great.
However, startups don’t understand the difference between making a profit, and having cash or working capital. A large amount of accounts receivables usually means they have bad debts. Many of these businesses will fail without help.
There are approximately 28 million small businesses in operation, with about 22 million of them with no employees. It is estimated that by 2020, 50% of us will be self employed. As a result, there is a need for professionals who understand the language of business or accounting. If you do not understand why this need exists, check out this video of a day in the life of an accountant.
The largest part of the profession is comprised of sole practitioners, either as accountants or bookkeepers. Check out these stats to see the future. If you adhere to the principal of working via the cloud, the cost of starting up is inexpensive, eliminating the need for servers. Applications are scalable to that first PC or tablet that you buy.
CPAs are ranked first among financial professionals, and accountants who are not CPAs are also well respected.
With that said, many baby boomer accountants and bookkeepers are retiring, so now is a good time to take advantage of technology that will allow sole practitioners to compete with large firms. We are entering the world of the “Gig” economy, which means more and more people will be self employed and small business owners. There is no better time to be offering assistance to people who are not equipped to deal with bookkeeping or accounting.
The link above for bookkeepers shows a decline. Bookkeepers aren’t going away, but those who don’t offer advisory services often do because most of the mundane tasks of data entry and collection are easily automated, and the business owner is able to do it. I am seeing smart bookkeepers doing consulting on setting up the books and educating their clients on the metrics associated with becoming more profitable, liquid and solvent.