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My Week: Strategic Change?

11th Nov 2016
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It was an interesting and a stressful week. I think FT Practice Ltd is on the way up to become a practice with a decent client base. The practice has made and continues to make good progress. I am pleased with myself. Please allow me some self-praise.

The small fee bank (practice) we acquired was based on the Crunch model. Though the fee bank is made up of contractors and small business.

As you may know, I am a big fan of the Crunch model. It is because the work can easily be delegated and the selling of the fee bank would be considerably easier. My ideal is to build a practice that can run without me and for me to look at other business opportunities. I am no way there yet. I want to be.

So far FT Practice Ltd has been a general practice. Meaning taking on more or less anything, as long I had the skills do the work. The client base of the practice, like most small practices, is varied. We are not a niche practice.

Now that the practice has an okay client base, I was thinking is it time for a strategic change? I mean keep the current client base and serve it well. At the same time adopt the Crunch model. I know they are many who have done this. I will be one more and hopefully better. How can one be better on bread and butter work? Learn from the master – Crunch.

I need to do more soul searching to help me decide whether an accountancy factory model is a way I want to go. Instinctively it appeals to me for reasons I have already explained.

I hope the season of hypocrisy will give me the space for some soul searching. If I decide to make the strategic change, the first key step would be a significant change of our website. It needs to speak contractor accountants and speak it LOUDLY.

Implementation of the strategic change will take up my time that I cannot spare at present. By the end of January 2017, we will be okay. We will have the much-needed breathing space for change or improving the status quo.

 

Replies (5)

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Glenn Martin
By Glenn Martin
13th Nov 2016 23:01

I would be cautious of going full on contractor Accountant FT. It's a fairly saturated market and even KPMG are at for £110 per month now.

You need to consider the UBER case recently along with Sports Direct, and other such businesses. The contractor is very much in cross hairs of HMRC/ Governement and I suspect it's only a matter of time before there is a shift back into employment for a lot of these workers.

The information MTD will provide from people with 1 paymaster etc will see a big clamp down I suspect.

I have about 30% of my work that falls into my contractor packages, although I don't turn work away I would not want it to be too integral to what I do, from an eggs in one basket point of view.

If you are wanting to try and form a Niche within your practice I would maybe go with something less exposed to HMRC glare.

Thanks (3)
By mrme89
14th Nov 2016 09:18

Copying the model of other companies will mean you will always be at least one step behind the competition.

Why change your website drastically? There’s no need to. You can have multiple sites, each site can be for a general accountant, or industry specific.
You can have:-
Xyzaccountants.co.uk
Xyzcontractoraccountants.co.uk
Xyzpubaccountants.co.uk
Etc, etc.

I also agree with Glennzy. Contractors are being targeted by the government. With the continues attack on contractors, and the ability for the government to almost eradicate the industry at a whim, I’m sure a lot of contractor accountants are a bit twitchy.

Thanks (2)
By The Highlander
21st Nov 2016 10:10

I agree with the comments above. Once the man in the street is talking about it and thinking it's a great idea that's a sure sign that it's time to get out. Unfortunately FT you are that man in the street.

Contractors are nice little money spinners but 70% of the ones that exist could disappear overnight from a change in government policy. IR35, dividend tax changes, all the signs are there that HMRC are going to continue to put the squeeze on this client type.

7-8 years ago my mates in marketing, oil & gas and IT were all asking me about forming companies and going down the contractor route. Now they are all looking to, or already have, moved back into employment contracts. Tells you everything you need to know.

Thanks (1)
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By Manchester_man
23rd Nov 2016 09:31

I agree with Glenzy. Made me wonder will all the contractor accountants do if/when HMRC do switch the fan onto number 3? Is there going to be a mass targeting of all our general practice clients? I hope not, but the likes of Crunch et al are hardly going to retire on the basis of "oh well, it was good while it lasted, time to call it a day"!

Thanks (1)
By mrme89
24th Nov 2016 13:23

FT - have you seen the Autumn Statement regarding the FRS?
Despite another nail in the contractors coffin, is it still the direction you want to take your practice?

Thanks (1)