What skills do you need to run your own practice?

Running your own company gives you the freedom to work when and how you like and specialise in an area that particularly interests you.

Whether you are a recent graduate or are thinking of leaving employment at a larger accountancy practice, deciding to go it alone is not a decision you can take lightly.

A lifestyle choice

It requires all manner of other skills from HR to marketing, not just your accountancy skills. For some people, that is part of the appeal – being able to grow a business and mentor and develop other people.

What are the options?

Sole trader:

For many people, working for yourself offers a high level of flexibility and efficiency which contributes to a healthy work-life balance.

Paul Smith, FMAAT, 48, is an AAT Licensed Accountant and runs his own business Paul R Smith Ltd from Halifax and Florida. He tried setting up a partnership and employing staff but now works for himself because he prefers the freedom to set his own hours.

“When you work in a partnership you can’t be spontaneous. You are set in a rigid work pattern. I enjoy the fact that I don’t have to commute to work or sit in a lot of client meetings. Most issues can be resolved over the phone, and my clients, who run their own businesses, appreciate being able to talk to me in the evenings when they have finished work.”

He set up his own business in 1999 and since 2008 has been based in Florida but working with UK SMEs, doing everything from bookkeeping, payroll, tax and income.

Building a business – first steps

Recruiting:

“It’s hard to recruit when you start out,”, says James Poyser at inniAccounts. “Firstly, you have no cash, you have no reputation, and to a certain extent, you have no vision to sell people. This means you have to compromise, and it might mean you select the wrong people or get the wrong partners in place. We learnt the hard way and almost lost the entire business over the wrong partnership.”

He says that looking back, he would have done things differently.

“I would have spent more time building a local reputation for potential employees. We’d have increased the value of the starting salaries and worked on building a good story to sell to people, including thinking through their development opportunities in advance.”

In recent years, the nature of an accountancy practice has changed, and communication skills and data management have become key. He says he is now putting together a five-year plan, taking into account the changes that automation, AI, and technology will play in it.

Take your time

Don’t rush into hiring staff, though, because they don’t always work out and the recruitment process can be time consuming in itself, says John Yardley, Founder and Managing Director of Threads Software.

“The productivity of a single employee can differ by a factor of 10 depending on who you have recruited,” he explains. It is better to offer a temporary role and if it works out, offer a permanent one. The temporary role is like having a very long interview.

And if you are starting from scratch with no customers, it may be an economic necessity to keep overheads as low as possible.

“In the current digital age, there is no commercial reason why any service-based businesses cannot be run from home,” he says.

“As soon as you employ someone, the benefits of an office are even greater because you can never get the same degree of interaction and team spirit when everyone is working from home,” he says. “Don’t hire an office as an ego trip though.”

How to attract the best staff

When you are looking to build a business you need to understand how to appeal to prospective employees. One of the key things young people look for is opportunities to develop.

As an owner-manager, you need to think about how you train your staff.

“Consider ‘how’ this training is going to be delivered,” says Teresa Boughey, CEO of Jungle HR, a strategic HR Consultancy Practice that works with Executive Boards and Leadership Teams during times of change and business transformation.

“It could be formal training but it could also be mentoring, shadowing, projects or on-line training for example. Creating a culture of continuous learning is also something which is really important.”

The skills you need  – business tips from the experts

• Get clear on your vision and your values.
• Don’t take on massive overheads. You don’t necessarily go and raise a load of money, take a load of loans, buy a load of equipment because that just puts pressure on your ability to grow, says Rob Moore, founder of Progressive Property.
• Find excellent people to delegate to. Don’t do things on your own just to save money, says Shazia Mustafa, Cofounder of Third Door.
• Choose a target customer – be as specific as you can – it means your marketing efforts are more likely to land. Start promoting and do 100 times the promotion than you think you need to, says Simon Paine, co-founder and CEO of the PopUp Business School which helps people from all walks of life to start their own businesses.
• There is absolutely no substitute for understanding everything you delegate. Accountants should take the same view about software. One good way to learn is to buy the cheapest product, learn to use it so you understand all the things you really need that it doesn’t do. Then you can spend more money on the right product, says John Yardley, Founder and Managing Director, Threads Software.

Key takeaways

1. Know your market
2. Buy in expertise
3. Learn to delegate
4. Be prepared to train staff
5. Consider specialising
6. Understand the importance of marketing
7. Don’t take on huge overheads

Becoming self-employed with AAT

If you’re an AAT professional member, you can apply for an AAT licence to become self-employed. This entitles you to start taking on clients and offering professional services on a self-employed basis.

If you’re interested in becoming an AAT Licensed Bookkeeper or Accountant and starting up your own business, the first step is to check out the information online to ensure it’s right for you, then download the AAT licensed member application form, and follow the guidance on how to complete the form.

In summary

There are a number of different skills you will need if you want to run your own practice. Self-discipline, resilience, the ability to delegate, a willingness to help with training and development, and an eye on planning for the future are all essential ingredients in a successful business.

For more on running a small business:

• How to be your own boss and start your own practice
• How to build a great small business culture
• Bookkeeping – what are the most common mistakes SMEs make?

Marianne Curphey is an award-winning financial writer and columnist, and author of the book How Money Works. She worked as City Editor at The Guardian, deputy editor of Guardian online, and has worked for The Times, Telegraph and BBC.