Plan on adding another tax office?
Things to think about.
The Tax Preparation Service Industry market size measured by revenue will be $10.9bn in 2021; it is expected to increase by 2.9% from the previous year. Meaning it is a recession-proof industry, and there’s lots of money to go around. However, before adding another location, you must analyze your current business and ensure you have the proper infrastructure to support a second tax office. Next, think about your finances, customer acquisition strategy, competitive advantage, training, and your system to address possible compliance issues that may arise.
Define Your Business Model
It would be best to decide on the business model to adapt for your second or subsequent office. For example, are you going to do a virtual location, a retail location, an office suite, or a kiosk? Whatever format your choose, you must realize that there are pros and cons. It would be helpful to evaluate each model to ensure that you are making the right expansion decision. The business model you select will correlate with your financial and operational investment and will impact Return on Investment(ROI) as well. So choose wisely.
Register
You are an experienced preparer; therefore, there’s a high probability that you already have this cover. As a reminder, you want to make sure you register your second location with the IRS and acquire a new EFIN. If you are doing business in another State, you want to research all applicable laws that may impact your new business. Some states (California, Maryland, New York, and Oregon) require tax preparers to register before providing tax preparation services. In some instances, this can create a high barrier to entry.
Build a Team
This step is vital to the success of any business and especially in the tax industry. Due to the seasonality of the industry, there’s little to no room for error. Ensure that you recruit the right individuals with the right attitude and mindset to succeed. They must be customer-driven, willing to learn, and pay attention to details. So often, tax preparers open their system to just anyone and spend little or no time in their training program. As a result, it becomes very stressful and sometimes leads to compliance issues with the IRS or local regulatory agencies.
Technology
Investing in the right office technology increases productivity and makes your life easier. Ensure you have the proper hardware(Computer, printer, etc.) and the right internet speed, especially when using cloud base tax software. Choose the right tax software provider that will provide the appropriate support and give you the ability to manage all your offices from one location. A software that is easy to use, whether it’s desktop or cloud-based.
Marketing
As a business owner, constantly acquiring and retaining new clients is essential to your growth. Marketing and promotion are crucial parts of running your tax offices. Designing and implementing a mix of digital and print strategies will be effective and yield results.
About SwiftFP
For over ten years, SwiftFP has provided innovative tax software solutions and services to tax professionals across the country. As your business grows, so do your needs. We specialize in working with Single offices, Multi-Office Operations, Franchises, and service bureaus by providing solutions to help increase revenue and grow their businesses. Partner with us today.
