CPAs

Now, I Have a Million-Dollar Practice

By December 12, 2019 February 24th, 2020 No Comments

Burnt out after 5 years, I had decided to sell my CPA practice. I was tired of endless staff problems, and working too many hours with too little money to show for it. Yet, despite receiving two full-price offers for my practice, I couldn’t bring myself to sell it. The truth was, I couldn’t stand the idea of someone else taking the practice one more step when I had come so far. I realized I needed to give it one last chance.

My practice faced many challenges. It wasn’t that business was slow, we were growing. But tax seasons were a grueling nightmare with panic in the office escalating as April 15 approached. I was working 80 hours per week during tax season and never saw my wife and two kids.

I had trouble finding and keeping good staff. I had a key employee who was eating up all our time with double work and mistakes. Something had to be done about her and the rest of the staff, but I didn’t know what. These were things they hadn’t taught in accounting school.

I had a financial services business, too, but it wasn’t netting anything. I couldn’t find the time or energy to put into it; my enthusiasm was slipping, along with my practice.

It was right before tax season in 2003. I remembered seeing Sterling’s literature sometime earlier so I gave them a call. When the tax season was over, my wife and I went to Sterling’s offices to take their management courses. We learned how to manage the practice, how to communicate better with the staff, how to make them more productive, more efficient and, best of all, more motivated.

When we returned, we began to use what we had learned. I saw improvements immediately. Based on the management principles I learned at Sterling, I changed our business model relating to the financial services area. I began to acquire financial services clients and to make money from this side of the business for the first time ever.

Our Sterling consultant was a real pro who took a genuine interest in our practice. Together, we implemented a new hiring process which resulted in finding a first-rate bookkeeper/administrator. With the hiring sorted out, I was able to find and keep good staff.

We also implemented a bonus system for our key producers and put in a communication system that streamlined the paperwork flow in the office. I started managing productivity on a weekly basis during tax season rather than waiting till the end to see how the numbers worked out.

In my first year, I was able to increase the office’s capacity by 30% to 40% without adding costs. As a result, during next tax season, we were getting our work done on time and there was no panicked rush as April 15 approached.

We dug in and confronted our finances, too. I was in the habit of building a credit line which would have to be paid off in January or February. As a result of the Sterling program, we conscientiously set about building a cash reserve during tax season. By continuing our productivity through the summer, and diligently adding to our reserves, we accrued a cash surplus which could be put back into the company. We no longer needed a credit line, which greatly reduced stress and freed me up to concentrate on new business and our highly profitable financial planning services.

Above all else, I wanted to be able to spend time with my wife and children. I didn’t want to someday look back and realize I had missed seeing my son and daughter grow up. With the practice under control, I made it a point to take off one week every Easter to spend with my family. Eighty percent of those weeks occurred right in the middle of the tax season. It’s really a milestone to be on vacation, log into my laptop and see that the company is making money and operating smoothly, and the date is April 3rd.

These days, I work about 35 hours per week during the off-season. I still work 50 to 60 hours per week through tax season but it’s far better than 80 hours and the hard work actually pays off in increased billings. Tax season or not, I never work Sundays anymore.

When I started with Sterling in 2003, our revenues were $230,000 per year. Now, I have a million-dollar practice including the financial services area. I manage over $40 million of investments for a limited number of ideal clients.

I’ve used the tools I’ve learned at Sterling in many aspects of my busy and sometimes hectic life. I grew up a city kid, but I have adapted to country life. I’ve found the time to learn how to ride my horse, Patches, so I can join my wife and daughter on rides at our farm. I’ve even learned how to make premium hay. I’ve become more efficient, balancing pastoral council duties at my parish and even running for, and being elected as, Chairman of my Wisconsin township this past year.

I give a lot of credit to the professionals at Sterling, especially my consultant. She never lets me go very long before I’ve defined new goals and a new game plan for my practice. This keeps me very interested in expansion.

I’ve also worked with other Sterling staff such as one consultant who helped steer us through a staff crisis. The husband of a key staff member had contracted cancer and passed away within a three-month period during tax season. The key staff person moved out of the area to be closer to her family and start a new life. My consultant guided me through the entire restaffing process and we came out of this unfortunate circumstance with our strongest team ever.

It’s been almost 10 years since I wanted to sell my practice. I’m so glad I gave it one last chance or I would not have known the success I am having now. Yes, Sterling has helped me put my business life in order, but they have helped me with much more. Sterling has helped me see what is possible with my family relationships, civic responsibilities, and all those fun times baling those “perfect bales” of hay for Patches.

Jaime Junker, CPA