Setting up your practice, becoming your boss and providing financial services that you might be interested in are a few reasons for opening a chartered accountancy firm.
With the introduction of GST, more CA firms are opening up as there is a greater need for tax compliances, more rules, laws and regulations to adhere to. GST is the most significant tax reform in the country, and therefore, a need to understand and comply with the processes has enabled many CA firms to mushroom in the economy.
Are you thinking of opening your chartered accountancy firm too? Here’s what you should take care of beforehand.
- Create a business plan.
Find a USP – It is imperative before setting up a business to decide what services you will provide. Go back into the past and realise what made you take the big step. The kind of services you wish to contribute, your core values and USP will set you apart in the market. It will help you land more customers initially and eventually set goodwill for the firm, where existing clients can recommend you to others.
- An entry strategy – entering the market will require more than just setting up your business. Aside from choosing your mode of operations and service, you will also have to plan for advertising and reach out to people. First, decide if you are providing general or specialised services, about a chartered accountancy firm, it usually means choosing between taxation, audits, mergers or acquisitions. You could also plan a merger or acquire an already set up CA firm. Doing this means you already have a clientele and regular revenue coming in. Once decided, reach out to people who might need your services and advertise in relevant media.
- Creating a client strategy – the next big step for your business is to get clients in. Of course, reaching out, word-of-mouth, references are a help, but you cannot solely depend on it. It is an era of e-advertising, having a website, a mention of your firm on your Linkedin profile eventually helps a lot. Research indicates that primary financial services, including statutory audit, company audit, LLP formation and GST compliance, will all be provided online eventually. Therefore, having a strong presence over the online portals, social media, CA portals will help you in finding the right clients. Once your networking is in order, you can be assured of business coming your way.
- Coming up with pricing strategy – pricing your services right is essential. Overcharging your services can drive any clients away, but undercharging can lead to financial troubles early on for your firm. You can choose from a variety of pricing plans – they can be time-based, service-based or a fixed payment. Decide as per the industry standards and stick to competitive rates for regular client intake and keeping financial troubles at bay.
- Taking care of capital requirements – Of course, there are two broad ways to finance your CA firm. You can either take financial help from any lender or choose to finance your venture from your saved up capital. However, it is advised to begin operations by taking financial support from outside as you can get a more substantial amount and then finance short term requirements from your capital.
It is a prudent method to go about commencing a business and leaves you an umbrella in case of any rainy day.
- Cash flow grid – As a top CA firm in India, you must be aware of predicting cash flows. So, prepare a cash flow grid that predicts your financial cash flows and economic exchanges. It will help you envision long-term financial probability and position of the firm.
An accurate cash flow grid prediction of the firm can enable you to plan other firm related expenses and build a rainy-day fund on the side. It will help you plan capital expenses and regulate savings better, and provide a near to accurate picture of financial viability.
Generally, working for yourself has many perks. You can maintain a work-life balance, work on projects you genuinely like and achieve your dreams. With GST regulations creating a massive demand for financial service in the market, this is the right time to open up a CA firm and start working for yourself.