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Accountancy Franchise

I am thinking of starting an accountancy practice and am curenlty revewing Abacus Accountants Franchise and CerTAx. Just wondering if anybody has any experience in dealing either with the Franchisors or Franchisees or indeed are there any acconting web members who are Franchised accountants.

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Unless you are a non-accountant or a nerd, why part with so much cash?
Have you done a cost/benefit analysis or don't you know what one is?

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Franchise
Explain to me IRR and NPV than I will give you a lecture on Cost/benefit analysis, IRR, NPV, DCF etc.

I am sure you know your double entry, which box to tick with relevant colour in your audit programme,
to add back depreciation, entertaining etc in tax computations You are a genius! What a genuis, you can even post a reply and a very helpful one at that.

I always thought an engagement letter was something to do with proposing to you intended, but no doubt you will put me right!

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you do not....
...give any reasoning as to why you are considering a franchise route.
(There are several reasons as to why you might.)

The two TaxAssist folk I have encountered have not been good by any stretch of the imagination, but I suppose you could argue that it is only the less good ones that you are likely to encounter.

Never come across any certax or abacus folk, good or bad.

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Reasons for becoming a Franchisee and NO endorsement
1. You do not give reasons.
Fair comment. There are several, the one that come to mind immediately are:-

a.)Business Development. As a sole practitioner one will have limited knowledge, time and budget to secure potential clients. Franchisors that have been established for some have the resources and expertise to help their Franchisees achieve a good client acquisition rate (at a cost).

bi). Practice management help - not having worked in a practising accountant's environment one would need guidance in systems and procedures.

bii). Any competent ACCA or ACMA can draw up a set of accounts and do tax computations. I guess that he /she would probably be lost to advise start ups on the most efficient systems to use. He/she may go down the route of full set of books when a simple cash book may be all that's needed. This is where somebody who has the experience would come in useful.

Are there any other routes to achieve these objectives?

c). Technical support if and when you need it. As a sole practitioner, I am sure, there will be times when you need to get another opinion. Franchisors claim to offer help in this area. I am aware that there are help line one can subscribe to, but am reluctant to ask them what may be basic questions.

d). Proven Business Model- hopefully. Helps reduce risk of failure.

All above of of course comes at a price.

In what capacity did you encounter TaxAssist Ffranchisees? Did their clients change to you or ???
TaxAssist's business model is open to all (even say a cab driver) as they are given a full, comprehemsive training.

No endorsement
Agreed, I did not take it that you were endorsing TaxAssist. It is my responsibility to carry out an investment appraisal, which would include research on the Franchisors. In my view one can get a very good idea of the reputation from current and ex franchisees. That's why I posted my question on the forum.

Other forum members can only offer their experiences and opinions. Ultimately it's my decisions. (Buyer beware).

Thanks for the useful questions, most of them were on my list except a couple of gems, which I will include in my list.

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AN OPPOSITE VIEW
I would like to answer your question and offer another view of the Certax Accounting franchise.

I think your background, training and experience has a lot to do with finding the best route when setting up an accouting practice. In my case, I left professional practice in the '70s as soon as I qualified as a chartered accountant. I spent the next 30 years or so working for multinationals in oil, textiles, mining and other industries in the UK and overseas. About 6 years ago, I decided to go back into practice and for the first time I was invlolved in running my own business.

I looked at the various franchise opportunites (I attended Birmingham franchise exhibition etc. and spent a day each at 3 franchisors). I looked at the franchise route mainly because I had to bring myself up-to-date being a Rip van Winkle and I wanted assistance in develpoing a client base from scratch. The reason I chose Certax was that I liked the look of their training programme (which might be meaningless to someone with no accountancy background) and, more importantly for me, they did not appear to want to interfere with your business as much as some of the others e.g. in how you would market your presence. I could not see the point is setting up my own business if somene else was going to run it for me! (Incidentally, Certax were also reasonably priced in comparison).

Needless to say the market had changed much in my 30 years plus absence and there was a much greater supply of accountants for the small business sector where regulatory requirements were much relaxed. (I was brought up in an era which did not permit accountants to advertise and ther were no audit thresholds)! My experience has been that telemarketing and media (website, directories etc etc.) had very limited success or were a complete waste of time respectively. All right if you are prepared to be cheapest of 3 quotes but a bit like a pluber or offering a paint job.

I devoted my efforts to business networking in the first few years. This and client referrals (particularly the latter) were the only cost effective ways I found of building a client base. However it takes time. If you are impatient or want to do this more quickly then I imagine the best route is to buy out an established practice. I did make an offer for part of a practice after 2 years in business which was accepted initally but the seller eventually decided he wanted to continue working beyond retirement age. I dare say he was a Scottish presbyterian like me.

I have not since pursued that option as I do not need to but I would say that taking on a new practice or developing a client base from scratch is a 7-days a week effort to achieve success. (Maybe 8 days a week if you buy a practice). How anyone fares in my experience is down to the hard work put into it rather than a franchisor or anyone else presenting a ready-made business on a plate.

Finally, I have found Certax very useful in supporting my efforts. I admit that the service from the helpline has been variable over the 6 years as staff have changed but I have to say for me in the past few years this service has been invaluable in providing a second opinion or introducing new ideas in unfamiliar situations. You have to do some work and resaerch yourself, however. Also there is nothing out-of-date about the bi-annual conferences with updates on latest tax issues. In my view, clients will buy into the individual and not the name or brand. So good luck!

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Opposite View-but
Thanks for the response. Interesting read, however, given you background, you probably needed very little help after the training course. The help, guidance and support has to be viewed in the context of their
marketing material. It sound to me from the first response that CertTax did not make good on those promises.
I have not signed up as yet, but the marekting material does make bold claims regarding CerTax's support , help and guidance.

That aside it would be interesting to learn a little bit more about your experience including:-

What was you client base at the end of your first year?;
% that can be directly attributed to CerTax (through their lead generation programme);
Client quality (average fees) acquired through CertTax;
Attrition rate attribuitable to clients acquired through CertTax;
Average number of leads you get from Certax and conversion rate;
Client base now and % attributable to Certax; and
Do you find their accounts production software (VT) good enough for your practice?

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Just answer the question! Stop posting your personal feelings

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Yup
Hi

I run a CerTax Accounting franchise in Rugby. Very happy with it and running very successfully. Feel free to contact me if you want to chat.

Kind regards

David Nicoll

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Ha Ha Ha Ha! Priceless
David Nicoll is the National Marketing Manager of Certax!
Come on, to pose as an innocent franchisee is disingenuous in the extreme.
As the national marketing manager, do tell us why the number of franchisees has fallen by 25%.
Is it the franchise that's the problem . . . . . or the marketing!

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CerTax
Firstly I will declare an interest up front, I am Jon Newton and I have served as a Director of the CerTax franchise for just over a year now, as well as operating my own franchise which I have done for 3 years now.

In response to your initial question you have had one response from someone who seemingly didn't make the franchise work and a couple of other responses from people who have, most noticeably David Nichol who currently runs the largest practice in the franchise. David is not the National Marketing Manager as claimed by another respondent but as he is a very successful and entrepreneurial individual he does help out with this area.

For my part I joined CerTax because although I had qualified as a Chartered Accountant way back when I had worked in a corporate environment since qualifying so my tax and small business knowledge needed refreshing and supporting. I'd had CerTax recommended to me and met with them beforehand to get a thorough understanding of what I was signing up for.

What attracted me to CerTax was that I could build the practice according to my own needs and requirements without there being any Big brother interference from the main franchisor, plus there was a thorough training course before I started the practice to refresh my knowledge, and after that there was a technical support helpline plus 2 seminars a year to keep that knowledge current.

As a self-motivated person I have worked hard to build my practice with the support of CerTax and on my part it has been a the best investment I ever made. Perhaps the reasons the respondent who apparently didn't have any success with it had more to do with their own failings rather than the failings of CerTax.

My advice to you would be to make your own mind up and see which franchise fits best with your own personality and requirements. The support will be there from CerTax if you need it.

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As an ex-TaxAssist Franchisee...
...all I can say is that they do exactly what they say on the tin, and will help tremendously with the business Development side if this is the area where you are weakest. They are honest & helpful.

If you feel the franchise route is a must, then I for one would recommend them, but, as ever, do your due diligence and make sue they are right for you!

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Not the National Marketing Manager?
Mr Newton, I think as a 'director' you ought to know what your online prospectus is stating. David Nicoll is down as National Marketing Manager. By the way, you have been demoted to Franchisee Development Manager. Go on, take a look.
Clearly, you and he are singing from the franchisor's hymn sheet and not the franchisee's. The pretence otherwise is a little pathetic.

http://www.certaxaccounting.co.uk/prospectus.html#anchor787664

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Thanks for the replies so far...
Thank you all for the information provided so far. As I am going to make this decision only once, the more information I have the better it is for me. Ultimately, I am responsible for my own actions, other can only help with information.

1.With that in mind I should be obliged if Messrs Kent, Nicoll and Newton provide some details on the questions asked of Mr Kent.

2. Ex-TaxAssist possible for you to alslo provide information on the questions asked of Mr Kent? I am yet to attend TaxAssist discovery day, however, it appears from the information on public domain that TaxAssist compel their franchises to incur significant overheads in order to increase the top line, but with negligible impact on the bottom line. (eg must have a shop front).

3. Anybody has had any experience of Abacus?

4. I have looked at AIMS as well but not too keen on it.

5. Of course the final option is DIY.

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Accountacy Franchise
Where about are you based? I am going through same process and at a similar stage as you i.e. intial research stage. Might be useful to exchange ideas.

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Skylarking your comments are spot on! You are sharp!

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From ome Anon to another Anon
Agreed, exchange of ideas would be useful. How do I get in touch with you?

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An Opposite View
Happy to answer your questions if you call me at the week end. Too tied up during this week.

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Weekend Call.................
Hello Mr Kent,

Shall call you over the weekend. Presumably you will be at the office. Shall google you to find your number.

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CerTax
I have been a Certax franchisee for nearly 8 years now and have found their support, training an marketing invaluable,
I now have a successful practice with a T/O in excess of £100K with no employee costs!! I only used the Certax marketing campaign which I found to be very successful - the leads were excelellent and I convereted on average 2 out of evry 5 visits. I no longer need to advertise!
I originally trained as an accountant with Kidsons Chartered Accountants and then after a successful career in the City I retired in 2001. It was then I dediced to launch a new career. I found Certax to be ideal and indeed offered all the support and training I required at the beginning of my new career.

I suuggest the ex franchsie who is so disenchanted with Certax lookat his/her own back door and indeed wonder if he/she would have been succesfull and any franchise or self employment - perhaps he/she should seek employment!! As with any relationship it requires input from both parties to make it a sucess!!
Verification of this statement and my name and address can be obtained from Certax HO
Richard

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Granted you are successful.............
Richard,

Granted you are successful, I will find you name and address from the net and may be give you a call.

The ex-franchisee has raised a significant point: the reduction in Franchisees from 100 to 76. To me this is a material attrition rate, wouldn't you agree?

Messsrs Newton and Nicoll felt that they had to respond to the ex-franchisees comments, but did not find it necessary to offer some explanation regarding the attrition rate. I accept that thy are not obliged to do so.

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Richard Hexton's Response
Richard

As you say you were a Kidson's person - a top accountancy firm. If I remember rightly you have also written a few books/articles. You are a very bright person. I would not say that you fit the profile of an average Certax franchisee. You would not have needed the same level of support as others.

In addition, the support offered to franchisees in the earlier years (when you joined), I understand, was far superior than it has been in more recent years. This is also backed up by reduction in franchisee numbers.

You would have done well whichever route you had chosen.

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Another happy CerTax Franchisee
I started a CerTax franchise 8 years ago without a background in accountancy - after various maths degrees I became a management consultant and then a director of a couple of companies. I have found the support and training excellent and I have built up a very successful and enjoyable practice.
I joined Certax as I was looking for a job where I could be my own boss, work from home with young family, do challenging work and earn a decent living. I have achieved all these goals. I have chosen not to take on employees, as working from a home office suits having a young family, but would easily be able to expand the practice if I wanted to. I have had no problem finding new clients, both through the Certax central telemarketing function and through local advertising.
I would have no qualms about recommending CerTax to a potential franchisee with a suitable background and drive to make it succeed.

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Richard 100 t/0
My question revolves around your claim of a £100K p.a. turnover with no employees.

Would you say your practice is different from other practices ?

I raise this question as if you assume all your clients are corporate and you were to charge each one £2000
in respect of VAT return,Dirs Tax returns,payroll,A/cs prep you would an average clientbase of 50.

This assumes the workload is spread over the entire year which it is not

How do you deal with the peaks and troughs ?

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Richard £100K t/o
I tend to agree with the previous post. I have been told by more than one Franchisor that extensive research has proved that a one man band can if he pushes himself to the limit can achieve a maximum turnover of £60K, beyond this he/she would need staff help.

I suppose if the average fees are higher than the most aother practices or outsourcing costs are not classified at staff costs, £100k turnover may be achieveable. On the other hand there is this curcial point of peaks April, July, October, December and January in my case.
I suppose papyments to wife and kids for work done.................

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Legal instruction to review this thread
Hi,

I've received a legal instruction to review this thread and remove any potentially defamatory or libellous posts. Under these circumstances I always try to leave as much of the thread as is, however certain posts will need to be removed (and any subsequent posts that reference any deleted ones, to keep the thread's flow).

If you have any queries or comments, please send an email for my attention at [email protected].

Kind regards,
Darren

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Slander ?
What the references in other replies have indicated is the comments on a bulletin board are akin to slander.

A subjective approach was taken in previous cases.So if the comments were honestly held this will be a defence in a case of defamation.

It should be noted previous case are High Court cases so could be over-ruled by a higher court in subsequent cases

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Removal of Certain Posts
I am the original poster of the query. I found the replies useful in my evaluation of my potential investment, I am very disappointed that a decision has been taken to censor the thread.

I have to go now but why are we stifling exchange of views and helping each other? I fail to understand.

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It's a legal obligation
When we, as the publisher, receive a solicitor's letter to remove a potentially damaging post from a forum, it becomes our obligation to respond and take a decision on that post.

The posts I have removed were either potentially damaging, or in direct response to the potentially damaging comment. Re the above post ('Slander ?'), honestly held opinion is indeed a legal defence (but only as long as it's held without malice, that is) - so, even honestly held opinion can still be defamatory.

I've got more experience of dealing with defamation take-down requests than I'd particularly like, and unfortunately it's a widely held misconception amongst many internet forum users that they can post what they wish!

Hope that explains things - I'm happy to continue any conversations by Private Message, but not on this thread.

Regards,
Darren

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I think it fair to say....
........that Certax must go down in many folks estimation - even those that know nothing about them !!
Quite an own goal I would guess.

That they should take cover behind the skirts of a solicitor because one sole posted some heart-felt comments about his experiences with them is pathetic.
The individual's comments were acerbic and negative, but anyone reading the thread with a mental age above 10 was going to take them as they were (some objective points mixed with plenty of emotion) and would understand that any organisation is going to have disaffected soles. Certax swung into action to ensure they had plenty of franchisees posting glowing references, which is perfectly fine and fair (perhaps not all were quite transparent enough, which rarely works on here - thank goodness - but in the main quite clearly and properly tagged and explicit).

The Certax response is far more negative (about themselves) than the original and now censored comments of the disaffected individual (we could all work out that he was disaffected !!).

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Fact
If a contributor posts an article of fact re:failure of a franchise,this clearly would not be slander.

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Due diligence/Buyer Beware !
Suffice it to say !

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Review of Certax
I am the person whose posts have been removed. The fact that my post has been says makes a further point about Certax. I just wanted to make sure any other potential franchisee goes to into a franchisee with their eyes fully open. When I was considering a franchise, all I found was the usual successful few franchisees (from marketing material) talking about how good franchise has been.

Any learning organisation would ask itself:

-Lets looks at ourselves

-It is great feedback – let’s learn and change to survive and beat the competition

- Why have we failed to meet franchisees needs? What are we going wrong? Let’s talk to our franchisees

- Do we need to change our management to be far more effective

- We just cannot continue with the way we are

It would have been far more effective if Certax had come with a message saying we are very concerned that we have failed this franchisee. This is great feedback for us, we will look at how we need to improve to ensure all our franchisees run a successful business and recommend us to others. This open approach would certainly win my respect and I have no doubt others would feel the same. Lets beat this franchisee approach will mean Certax will continue to lose business.

It would please me no end to see any learning organisation succeed. In fact I would be the first one to sing praises about them.

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How can Certax respond to your comments on this site?
When you are anonymous?
Presumably they don't know which failed franchisee you are (it appears from the figures there are many).
Actually, they don't even know if you were ever a franchisee. Maybe you are engaged in commercial sabotage and work for Tax Assist!
They don't know. We don't know if you post with the cloak of anonymity.

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Request a balanced thread.................
As the original poster of the question I suggest that:-
Responses by CertTax directors be removed from the thread- clearly they will give a biased view.
Some of the responses from very happy franchisees be removed for the thread to be balanced.
The thread now gives an extremely favarouable impression of CerTax.
Readres now have to guess what was in the negative response and probably would wonder that it was all incorrrect has the site has been fpreced to remove the negative response.
So there we have it - all happy CerTax franchisees.

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Just remember...
lets all be careful out there .....

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Franchise helplines
Having had a stint providing the advice at other end of the helpline, I can say it is astonishing what crap some of the other people were giving out. More worrying was the utter inability displayed by some of the '4 week into practice' people. The questions being asked were often so elementary iit was extremely hard not to take the p .

That said, I did always try to give more than a basic answer offering thoughts beyond the original query which often hadn't been contemplated. However, once it becomes a 4 chargeable hours situation answering the lines, you ain't gonna be economic (I believe it was c£160/day at the time to man it).

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No reply = Beware !
I note Richard has not replied to the question re:£100 K turnover !

So,BEWARE !

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Choosing an accounting Franchise

Going through the same exercise as well. Would love to exchange ideas. Please contact me at francks at msn dot com.

Thanks a lot.

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Choosing an accounting Franchise - Franks

Please do not waste your money. Rule out this option. There too many unsuccesful franchisees. Don't be fooled by any glossy marketing. Read the thread below. I am sure you have been contacted already. BFA is no protection, it is just another marketing ploy used by franchiors.

www.accountingweb.co.uk/anyanswers/becoming-accountant-5-weeks

They are assured of their managemnt fee you are not assured of your income. Stay away unless you have the dosh to give away to these vultures.

 

 

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Choosing an accounting Franchise

Dear Anonymous, are you such a failed franchisee? Or do you know any? I would love to talk to one of them.

I'm trying to weigh the pros and cons and to be honest, if £30K allows me to get just a 15% increase in turnover in 5 years (assuming my objective is to reach £200K - with or without a franchise) it's definitely worth it for me. And if I can't reach that turnover with a franchise I don't know how I could by myself with no experience of running a practice and very little knowledge in marketing and SEO optimization.

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