Intro (00:00:00) - Welcome to the modern CPA Success Show, the podcast dedicated to helping accounting firms stay ahead of the curve. Our mission is to provide you with the latest and greatest insights on cutting edge tools, innovative marketing strategies, virtual CFO services, and alternative billing methods. Join us as we change the way people think about accounting.

Tom (00:00:22) - Hey Adam, how are you today? 

Adam (00:00:23) - Doing really good. How about you?

Tom (00:00:25) - Doing good. Well, I think people are going to be excited about this with Cory Gayman. This episode that we're about to do. Any initial thoughts that people should be listening for?

Adam (00:00:34) - Yeah. Think it's just interesting because we talk about marketing and picking up clients and doing all those kind of things. What we don't hear a whole lot about at a smaller level anymore, our acquisitions. And Cory has a lot of experience acquiring small tax practices. I know he's just kind of on the cusp of developing the advisory piece, but I think there's a lot of lessons learned if you do want to start acquiring businesses. You know, he's got a lot of experience and he shared a lot of great details with us.

Tom (00:01:02) - Yeah, I agree with you. And he really did get into some good detail around kind of early things, what he did, lessons, kind of managing the team, what it looks like for the person who's selling and sticking around common processes. He had a lot of nuggets in there that think people are really going to enjoy.

Adam (00:01:18) - Yeah, absolutely. Let's jump in and see what he has to say.

Tom (00:01:21) - Sounds great. Welcome to this episode of the modern CPA Success Show. I can already tell from kind of the pre discussion that we have with our guests. This is going to be a really fun episode to have in here. I'm Tom Wadelton I work for Summit Virtual by Anders I'm co-hosting today and my usual co-host is here, Adam Hale and Adam co-founded Summit CPA Group and now runs that practice for the Summit Virtual CFO by Anders. Adam, welcome today.

Adam (00:01:47) - Thanks, Tom. Glad to be here.

Tom (00:01:49) - Cory Gayman is our guest today and Cory started JCG CPA firm. Cory welcome today.

Cory (00:01:56) - Thank you. Thanks for having me.

Tom (00:01:58) - Would love to hear at the beginning. Just tell us a little bit about your practice and you and your background, and then we'll jump in and get to some of the topics.

Cory (00:02:04) - Sure, absolutely. I got my start in a small firm like mine, you know, tax focus and bookkeeping focus, working with smaller clients. Worked there for seven years, decided to move back home and start my firm in a small town. So kind of went from there. That was nine years ago this July. So we're nine years in now, and I've grown that just one small office. It was just me at that time, growing it to almost 40 employees. And we're across seven offices now just through acquisition, natural growth and getting good people, to move us forward. So we moved into we're in seven different cities.

Tom (00:02:43) - That's cool. Let's talk a little bit about team would love. It's a common buzzword and I wonder about your experience shortage of CPAs. Are you you've conquered that and you're here to give us a solutions you're dealing with.

Tom (00:02:55) - Where are you with that?

Cory (00:02:56) - Fighting it daily? Maybe not necessarily quite yet. I was lucky I ran into an excellent CPA this last fall that has joined my team. He's become, you know, a great asset to the team. Before him, I have picked up along the way when I could. Some have been through acquisition, but most of those are wanting to retire, of course, so they're around for a couple of years. We have several in training right now within the firm that are hoping to move toward their CPA, or even just just for what we do, and is very valuable as well. It's hard to find somebody that wants to get a license. Right now it seems like, you know, they've been declining every year. They say for 21 years now. And I don't know if it's difficulty. I don't know if it's they don't feel like they don't need it, don't have the hours. You know, there's a lot of theories out there of why people shied away from it.

Cory (00:03:51) - But we're trying to promote the industry, trying to promote the profession, trying to to encourage our staff and students that run into encourage them that this license will take you a long way, with or without our firm, even if you're private or in a separate arena, that this license is a good license to have. But yeah, it seems like we have to sell it to people or we sell people on it right now. So it's something we're all battling.

Tom (00:04:20) - Sure.

Adam (00:04:21) - So I can see where you're coming from. Definitely an advocate of the CPA license. Talk to us a little bit about the services you provide your clients, like what are the core services. And do you see there's a difference because Cass obviously is coming on pretty strong. AI too used to be a huge advocate of like everybody has to have their license. It's an integrity, a credibility kind of a thing. And then just over time, just especially on the advisory side of the firm, I've just noticed there's some really good people in industry, maybe with MBAs or things of that nature.

Adam (00:04:53) - So I've kind of I've changed my tune just a little bit. But talk to me about like what those services are and if you do have kind of sure, you know, different point of view on, you know, depending on and I don't.

Cory (00:05:05) - And I don't fully disagree with you and don't fully disagree with the ones that decide not to get it and choose a different path. Um, one of the things that we battle, and this is slightly off the topic of your question, but it's the boards. It's the state boards. This the requirements they put in place. And you must have a CPA at that location and it must be a certificated person, certified person, so that the law is not catching up to the reality of the experience that people can gain just from work. They come in and they can work five years, and they can almost do everything I can do at my office. And let's just be honest, it's the same for me. I did obtain it.

Cory (00:05:46) - I do promote it. I do need it. I think it can take people further. But you're right, with the tools that we have now.

Cory (00:05:55) - You could still make a good living without it. One of my selling points is that you. You have a ceiling. In that case, unless you're just a driven, entrepreneurial person and you move that forward. Maybe you don't have a ceiling, but that license and the private practice in the public world and management, there's really no ceiling. You can continue to go up and up. So that would be my promotion of it still in light of what you said. But don't I don't fully disagree with you. There are a lot of services that can be done without it the enrolled agent license or certificate. It has become very valuable. The credibility that it brings from the public is really what those letters are giving you. However, five years tax experience, 20 years tax experience, 30 years even. Sure, that's really what matters.

Cory (00:06:48) - I mean, that's really end of the day what matters in our practice we focus on tax that would be the core of what we every other other services around. So we help people with tax returns, business tax returns, complicated real estate style tax returns and of course individuals during tax season. From that base we build outward. Sometimes bookkeeping services, tax services or payroll services stayed away from audit that seems to have diverged. And the bigger firms can take care of audit. We'll stay away from that arena for a while.

Adam (00:07:20) - Yeah, we're with you there. So okay, so it sounds like especially I would say that, you know, in audit in tax I agree. Like the CPA seems to be kind of the right the way to be there for sure.

Tom (00:07:32) - Yeah. So if and none of us have but you admitted. So you haven't totally conquered getting everyone that you want. So what are some of the strategies you've employed? You've still got clients who still want to get work done, but you can't just flip on the spigot and get more CPAs whenever you want them.

Cory (00:07:47) - Exactly. You know, we've had to hire recruiters. We've had to put ads out. That can get rather expensive. Unfortunately, we've had to be more enticing and make our place a better place to work. There's a lot of competition out there as far as you know. What services are you offering your employees? What perks are you offering them? What are the basis that I've always tried to build the firm on with my employees is a good work life balance, and I know that's been a buzzword for a while, but it's true, and there's not a better way to say it. I want my employees to get their jobs done, but I want them to have a home life. I have a family, I have three small kids, and I don't want to miss their childhood. I don't want any of my employees to either. In the very beginning, I told everyone I hired, I said, look at this time, this is all I can pay you and maybe you can find more somewhere else, but I can.

Cory (00:08:36) - I can let you off for every ball game. I can make sure that you're home for your kids later. I can make sure that if something comes up, you just tell me what's going on, and you go take care of your family. Because to me, family is most important. And I've tried to really promote that and push that a lot. One of the big black eyes that our profession has is the all go no quit. You have to work till midnight. You work through the night during tax season. I mean, this generation doesn't want that. My generation, I don't think anybody wants that anymore with just doing this conversation that we are here, shows us there are better ways to get these jobs done. We can do it virtually. Someone can work from home. There's better ways to do it. So I've really tried to create that culture and that atmosphere. And lately, over the past 18 months, we've seen some success from that to get some good employees that want to work with us, want to have that flexibility.

Cory (00:09:31) - Um, and it's working so far. So I believe that's the continued route to get some good talent.

Tom (00:09:37) - Yeah, it's the how part of that is something I'd love to dig into some, because we've emphasized a lot around things like streamlining processes and efficiencies. I'd be interested in that because, you know, it's one thing to tell the team to do that. But are there some things you've done that you say, okay, this works really well to allow someone to actually leave and not have the work falling apart or totally dependent on that one person. Right?

Cory (00:09:58) - So we do some cross training, and I know that's a traditional tactic. I do want more than one person to be able to handle a client. I mentioned that we had seven offices. We try to make the processes at each office basically the same, and we utilize an online server. And so with that online server, it doesn't matter if they're 300 miles away, they're effectively down the street or down the hall. You know, we can, any of my employees can jump into any client and take care of the process, take care of the task that needs done.

Cory (00:10:29) - So if I've got someone to get sick or has a funeral or has something that they need to be gone for, our work can still get done. Our clients can still be taken care of.

Adam (00:10:39) - So have you looked into, you know, keep coming back to the shortage in the process and all that stuff. Have you done anything with offshoring or what's your take on that? Have you explored that?

Cory (00:10:49) -. So I get asked about it all the time by salespeople. Of course, I've also heard from many clients that I have taken on how much they dislike that. So no, no, I do not. I don't want to do offshoring. I would prefer to keep everything very local. I would prefer that when someone calls in, they're talking to a person at one of our offices, and I don't like the idea of the data moving somewhere that I can't fully control you. Obviously, that's a very big deal in our profession. And, you know, let's wrap that back to why CPA is necessary there are reasons why having that certificate and having that board matter.

Cory (00:11:29) - And one of those is the ethics, is the confidentiality, is the privacy. A lot of people feel more secure about those things when they see the CPA firm or the CPA license, because we have a board that regulates it. That's just another one of those pieces. I had a client come to me a few years ago and his accountant told him, hey, I offshored all this data entry and they charged him for it at his rates. And he was furious. He's like, that doesn't make any sense. I don't want my stuff going anywhere. And I want you to do it, and I want it to be done locally. And why are you charging your rates? And I know you paid them nothing that you know, that was just the client's take on it. But it kind of led me to see that. I don't know that's a realm I want to get into just yet. So and I want to create jobs right here. And like the towns that I'm in, most of them are small.

Cory (00:12:18) - I'm from a small town, you know, 3500 people. So where I was born and raised, and that's where I moved back to to start this. And I want to create those jobs for people in those towns.

Adam (00:12:28) - Sounds like the beginning of, like a John Mellencamp song. Sorry. Tom and Tom and I are from Indiana, so yeah, there you go. So. So we get that southwest Missouri.

Cory (00:12:36) - Not much.

Tom (00:12:37) - Different. Yeah.

Cory (00:12:38) - Yeah.

Tom (00:13:20) - A little bit of another take, and I'd love to hear your thought on that, because I've heard many people say that we do leverage offshore capabilities. For many, the things that our team members don't want to do, and it's things like clearing an inbox of invoices that have to get coded using certain rules, and maybe some reconciliations with a lot of intent on what are people allowed to see and do. And we do have a lot of those controls in place, and we choose not to have our clients interact directly with that team, that they're that support team. That's one of the ways that we've helped take a CPA and say, okay, we want you doing some of the things that CPAs do in reviewing someone else's work right before that, and just wonder if you've had some of those thoughts and not to judge a decision you made, but think we found a lot of value without some of those risks in there for managing the risks.

Cory (00:14:06) - Yeah. And potentially I, I saw the feedback from the, from the front line and didn't, didn't dig in anymore to see how to solve those problems because I hadn't quite got to that point where it was necessary.

Cory (00:14:18) - Yet. I worry, and I think every one of us do, about the cost of labor here, and I worry that that could continue to force professional services offshore like that, that that could be something that I dig into further in the future. But at this time, I've found enough good people and been able to keep costs in control that we could do a local and I'd rather do that. These are my friends and people that I get to know. And I see and I know their families and I care about them. And so I that team aspect, that family aspect of our firm, I'd hate for that to go away or feel like it was cheapened.

Tom (00:14:54) - Yeah.

Adam (00:14:54) - Yeah. Think for us. I think, you know, going back to what Tom said, it was less probably about the cost for us. And it's more because in some instances, I don't know that you save a terrible amount of money because you got to, you know, you got to put a point person in there.

Adam (00:15:07) - You do have the additional security. You know, I would say our security probably internationally is probably tighter than, you know, US security. But the but the other thing was, is just whenever you were talking about before quality of work, what we're finding is like the young professionals, they don't want to enter bills, they don't want to, you know, and then and so and so what we looked at is the stuff that number one is just kind of a training point for them that they don't want to necessarily do. Doesn't mean we don't have them do it right away and then quickly move them out of it. But also we were looking for areas where I don't want to necessarily build out a stateside bookkeeping team that in all reality, will probably disappear due to AI and technology, maybe in the next, you know what I mean? Like even doing tax returns, like preparing tax returns will likely it's it's probably in our near future that that will go away either through reform or through automation or something.

Adam (00:16:07) - You know, the majority of the preparation work is going to be gone. And then how do we justify our which is why a lot of firms are moving more into the advisory space. So have you started to leverage, you know, your tax services and, and bill for those and build that advisory service into your tax practice.

Cory (00:16:27) - So I'd say we're on the cusp of that since we are so tax focused. And I've acquired firms each year along the way here. So there's a lot of to do when you acquire a firm of course, and to get things straightened out streamlined. But to your point obviously, I mean, we all see that coming and I view technology as I always have with going back to, you know, cotton gin and the plow. Right. You just find a way to work with it. You find a way to use it. It's a new tool that you get to have. And so I don't see that as a bad thing at all.

Cory (00:17:01) - And our bookkeeping team is probably the first one affected. But potentially now one person can do the triple the clients if they're utilized. I think the AI that's the way I view it, and I view it as making our growth almost just unlimited, the potential for it. So at this time, you know, our bookkeeping team would try to keep it in check on how many people we have. But here along the way, we've, you know, we've used QuickBooks online for quite a while and there's been AI ish, you know, services inside there already with the downloading of the bank transactions and how it will code them for you. So we've already been getting up to speed on that. And honestly, recently I've hired quite a few 20 and under and they, they, they're already grown up with this stuff. They already it's natural to them to just work with it and get it in place. You know, it's almost like coding or something of the sort. So I'm seeing that coming and I'm trying to make sure that we are hiring people that fit with that, and we'll move forward with that.

Adam (00:18:03) - Well, I think it was interesting to just kind of shifting gears. You know, you said you have seven locations. Obviously, there's a lot with the mergers and acquisition pieces that we were fully distributed. So we didn't have any brick and mortar for about the last ten years. But there was a transition period there where we had like half the team in the office, half the team out of the office. And now that we've merged with Anders, now we have we kind of went back to that where we have like maybe, maybe like 20% of our team is in an office at least 2 or 3 days a week and just managing that cultural differences. So can you talk to us about like your experience managing seven locations? Don't know if you have fully remote people on top of that as well, but just trying to, you know, how do you pull that culture together? You know, obviously the system and processes, you know, the technology is important, but how do you do that from a cultural perspective?

Cory (00:18:57) - Right. So I from ground up I've only done three. The rest were acquisitions. So what we battle there is what is the culture already when you acquire it, is it good or bad and what can we learn from it for the rest of our team? And then trying to get someone in there that understands the way I want it to be, and to kind of start to morph it slowly. So, you know, it comes down to having a leader at each location, a physically present leader, and that does lend back to the board and the CPA and, and who's going to be in there and they become the leader effectively. Um, we've really tried to keep it consistent across the firm, yet allow each office to have its own nuance, have its own micro culture, if you will, while maintaining a larger culture and a larger theme of what our office is. I, I'm probably the glue that ties that together. I visit them as much as I can. I stay in communication.

Cory (00:20:00) - I have gotten to where I'm pulling away from as so much actual task work and more building of this culture, and it is something that I take a lot of pride in and want to excel at and want to promote a great place for our employees to work. But then we also have the remote employees. Like you mentioned. We do have a few that are fully remote. Um, we, I mentioned that we have an online server. Well, that means we have that tight end communication as well. Honestly, we utilizing teams and everybody stays in communication on teams. And we're able to to easily chat back and forth, get on the phone if we need to. And this year I think we're planning a year this year, next year planning a big get together. And we're try to get together once or twice a year and pull everyone together. So at the moment we're not too far away to make that cumbersome. But as we continue to grow, I know that'll be a bigger and bigger event, but still think getting everybody together face to face once in a while.

Cory (00:20:55) - Great thing to do. Just put a face with the voice.

Tom (00:20:58) - I'd love to hear more about those we do similar and being an entirely remote team, that's one of the important things. So we've done a retreat. Earlier in May, we did a retreat on Arizona, and we're doing another one for the division in October. Awesome. In Arizona, Adam was at about 90 people. Is that about right for the whole team? 75 people, something like that.

Adam (00:21:18) - I think we well, we had some support staff there. Think we had a little. Yeah, we might have been a little more than 100 people there. Employees.

Cory (00:21:24) - Employees only.

Adam (00:21:25) - Yeah. Yeah. So we do. Yeah. So what we typically do with the retreats is it's really important for it to be employees only for, you know, a couple days and then we mix in some fun, we start out late and then we'll mix in some fun there. But on the closing dinner, that's where we allow like spouses to come.

Adam (00:21:45) - And then they can extend their stay. So if they want to extend their stay and use our rates or whatever to, you know, bring the family in and hang out, then that's cool. So we've always done that. Just if you have the whole family come mean, don't get me wrong, if it's a small. Yeah, well, it's a lot of people. And if it's a small group it's okay. Yeah. But whenever you start to get into your bigger company, then it becomes a little bit more difficult because the idea is you want, you know, you don't want them to like, click up. Or have to, like, stay around their family. You want them to really, like come together. So. Yeah. So and we've always brought an outside facilitator, you know, for one of those things. And then probably one of the other things that we've done, that's that way we can be participants, right, as opposed to just running the show. And then we also have a, um, and happy to introduce you to her.

Adam (00:22:32) - She's been amazing for us, but she plans all of our retreat. So she puts the like she helps us, like, make sure, like all the print materials there, she does the hotels. She does mean she coordinates. Make sure all the flights are going mean. It's been really she's instrumental so that again so that yeah the team's well supported. But from a leadership standpoint we can be participants in our own retreat, which makes a big difference.

Cory (00:22:59) - And think that's really important too. And we're we're on the we are just now starting these to be honest. You know we've done it a couple where we've gotten together when it made sense Covid was happening. And so we were sure it didn't make sense at that point. And several of my retirees went on out through that through the Covid era, if we're calling it that. And they weren't able to be part of anything that we do. So we're we're hoping to have maybe in the fall, have some sort of boot camp training retreat, like you just kind of described, and then maybe in the summer or a different time of the year, have to where it is all families as well, and we're all close enough we can drive in and oh, great.

Cory (00:23:38) - You know, maybe we do a couple of days. We have to figure out lodging. Small towns don't always have a hotel, so. Sure. But we're on the cusp of doing that. And I hired my marketing director just this year. Her name is Melanie, and she does a great job at putting these things together. And she's really pushed me forward and saying, hey, these things are important. We got to make sure we're doing this for our employees. Let's get them together. That's what they want, and trying to make those things happen.

Adam (00:24:03) - You said you're in Missouri. I hear Branson probably for that fame.

Tom (00:24:06) - Oh, yeah.

Cory (00:24:08) - Probably, yeah. We have an office in Springfield just north of Branson.

Tom (00:24:11) - So there you go. You're already set, right. How much do you. So the team members who work in locations, is there any kind of working between. Do you have people who work sometimes in different offices, or is it pretty well set that if this is my office, this is kind of my only home?

Cory (00:24:25) - So.

Cory (00:24:25) - So yes, we have a few that might move around, but really it's more of a leadership in those. I have myself and CPA hired in the fall named Newman. We traveled to the different offices a little bit okay. But. When they're there, they can work on any client because they're all on the server so they don't have to leave. They don't have to leave their office and they can still assist the other office. That's really the beauty of how this server is played out. And my first acquisition, I got hooked up with his guy and he pushed me on this idea. He said, this is the way to go. If you want to grow big and you want people to help each other, that's the way to go. So I can hire in a small town that doesn't have a lot of demand for our services. I can hire people to be there with me in that office, and they can work on any offices, clients. And that's really opened the doors up for us, to work with people all over the country.

Cory (00:25:15) - And there's just no limitations anymore. And we can push our push out there what we want to do, how we want to work with them. And as long as they're on board with it and they'll submit documents electronically, they'll allow us to collaborate with their QuickBooks online, whatever we need to do. We have clients we never meet, and we have employees to don't meet each other unless we do these two retreats because, yeah, they're not moving around really at all.

Tom (00:25:38) - Okay. Okay.

Adam (00:25:40) - So you've moved a lot of your tax practice and stuff to being able to do virtual. So you still have your locations and you want your team to still be in person, but your clients aren't really showing up every day. There's you know, there's not 20 people sitting in your lobby waiting to get tax returns knocked.

Cory (00:25:59) - When I started the firm, just me. Right. That was the goal that was the that was the model, you know, drop it off or let's do this online thing.

Cory (00:26:07) - It was nine years ago, so it was still relatively new. And you guys know this in rural communities, there's still another 15 years behind usually 10 to 15. And just their thought process on everything. So it was very new to them. But I've always pushed for yes, let's get this online delivery set up. And along the way we have improved that process. And now it's really efficient. You know finished tax return I save it on our server and we put it in their portal. They're signing. They're paying us online done in five minutes instead of showing up. You know hopefully they review it first but done in five minutes. Instead of showing up the office waiting in line and doing that whole process as I've acquired some have already had that in place, some haven't. Obviously, it's very generational with the clients and some, you know, might demand a meeting and we just we try to ease those transitions because we want to maintain the legacy of our retiree and the practice they built.

Cory (00:27:04) - We do care about the clients, but we want to try to show them new options. And it's amazing how many times the client says, oh, well, I didn't know I could do it that way. I didn't know I could just drop it off. I didn't know I could take pictures and with this with my phone and upload it to this portal that you have, you know, they just didn't even know there was another way to do it. So we are not only becoming more efficient ourselves, we're making our clients lives more efficient with this process also.

Tom (00:27:29) - That's great.

Adam (00:27:30) - Can you mean for the folks listening that are thinking about because this comes up a lot, like I heard you say, that you hired a marketing director and those kind of things, it's always comes down to like, hey, where do we find these customers? How are we? You know, how are we locating these people? Do you do it through niche and you go national, that kind of stuff. But even more so you've chosen probably a more unique, I would say, a while back, traditional approach of acquiring firms.

Adam (00:27:58) - You don't see that as much anymore. Can you talk to us about like that journey and what you look for and what you really stay away like when you know to run the other direction for anybody that's like fed up with going, hey, I want to instead of organic growth, I need a certain leverage piece here and am okay with acquiring a couple firms. Can you tell us kind of the do's and don'ts there?

Cory (00:28:21) - Sure. So most of the firms that have acquired have been through a word of mouth referral known of a or a few of them already knew them, or I just showed up at their office. The very first one, I just put a business card in his slot and said, give me a call. And he did, and we hit it off.

Tom (00:28:39) - He had a bad day and grab that card and call you when you do.

Cory (00:28:43) - It in April.

Tom (00:28:43) - And they call that good timing is everything. Love it.

Cory (00:28:48) - I continue to get an HR block notice every April 20th.

Cory (00:28:52) - You know, this is the last year you're ready to sell. So. But no, the process is the person is really important. The person that's running that office and the team they have in place, that's what's important. The people are what's important. And the processes they have in place. I have acquired a few that had extremely old processes. I've acquired some that have a more digital processes like we already had, and they both have their challenges and they both have their pros. You know, some of those old practices, they still work, but they're inefficient. And so we want to get them all up to date. So sometimes that is pretty painful. So through the acquisitions we've done I have learned quite a bit. I have learned what to stay away from and what to gravitate toward. I absolutely love I always ask, you know, are they dropping off? Are they submitting through a portal? You know, that's a giant plus because that fits our model already. Or are you meeting with the client for an hour, every single client, just to do their tax return.

Cory (00:29:59) - That doesn't really fit our model. We would prefer get your documents, see what we're looking at, and then maybe give you a call and do a quick phone meeting about it. Hear your questions, hear your concerns. So I really analyze the processes. I analyze the retiree or just, you know, the acquisition leader and see what their tone is for a change and what their what they've allowed their clients to, what processes they've allowed their clients to create for them or they allocated for them. You can usually tell pretty fast if they're hand holder and if they bend over backwards for every single little thing. We love our clients. We want to take care of them, but we also have lives as well. So that does lead me into one more thing. And that's just that time back to that work life balance. It has become a little bit generational and I appreciate that, but I appreciate the modern times. We are putting more emphasis on that as a culture, this work life balance. But through the acquisitions, sometimes these guys, they have, you know, they've worked their life away and I can see it, I can hear it in their tone and I can see it in how they take care of their clients or how the clients are just showing up all the time or calling all the time.

Cory (00:31:21) - So usually those are the ones I run from. And we try to make sure that this retiree is happy with the relationship that he has. Yeah, it's pretty hands off. They drop their stuff off or they send it through this portal. I gravitate toward those and we try to get them as fast as we can.

Tom (00:31:39) - Interesting. Of your acquisitions. You said you've done four, is that right? Three offices and then four acquisitions.

Cory (00:31:46) - We've done three offices. So that's as far as the office is. Yes. But I've done two more acquisitions because they merged into an existing office.

Tom (00:31:52) - Okay. Most people retiring from the practice when you acquire or are you also buying firms and then they. 

Cory (00:31:58) - Most I would, I always try to get that retiree to give me at least two tax seasons, because you really just needed the first tax season. It's a shock to every client. Yeah. It doesn't matter how old they are. They just you can't retire. You can never retire.

Cory (00:32:11) - That's they literally say that to them. But if I can get two tax seasons out of them, that's a good deal for all of us. And they can transition their way out. They can start to have a lower a smaller workload right away and that's good for them. But then have done a few where they want to stick around for 6 or 7 years, and that's great too. Um, as long as you know it, they buy into the culture, they have to buy into the culture. And sometimes that can be difficult because they were a leader at their place and now they're not, or they have a different role. And that's okay, as long as we can all get on the same page. So it is good to have that person that sticks around for a while as long as they're buying in. But occasionally that's how I'm going to get a CPA, because at the moment, like we've talked about with the shortage ties back to it. So that's really been the easiest way to find somebody right now.

Tom (00:33:07) - Sure.

Adam (00:33:08) - I was just going to ask, how long do you how long have you found just kind of sit on the culture a little bit before you start implementing because I know that, you know, nobody likes their cheese moved. Right. And CPAs are definitely creatures of habit. You know, in that instance. So how long have you found mean. Do you usually say, hey, like for the first six months I just want to observe and then like the next one, I'm just going to implement stuff. Do you kind of have a formula or kind of a thought process around that?

Cory (00:33:37) - I will definitely say each one's different. Um, I've come into some where I bought actually a satellite office and the leadership team was gone immediately. So obviously we had to get in and take over and do everything right away. Others where they're sticking around, and that's fine. And then time of the year matters on this as well. Because of tax seasons coming really quick. You got to get the action really quick.

Cory (00:33:57) - Um, but you're right. I try to trickle the changes in, get the important ones out of the way, get their data to our server. We're going to do some to the server, but I also want them to be introduced to the team on the server and feel like they're part of a bigger community, a bigger team as well. But other than that, we try to just one thing at a time. I don't have a period where I just sit and watch. I think they sold because they want out of that role and they need that alleviated right away. So I do, you know, still act as the leader for that office. Me or one of my other staff, of course, or my the CPAs. We do need to step right in and be the leader of the office and keep that person as a trusted advisor and consultant. And I've been really fortunate that the ones that I've, that I have bought out, they bought in to our culture and to them selling it was a relief, you know? What I've learned is that these things are their baby, you know, they created it.

Cory (00:35:03) - They worked it for 30 years, 40 years. It is difficult decision for them. But once they've done it, once the decision is made, once we're moving forward, it's a big relief. Okay. It's not all on me anymore. I'm not carrying the weight of everything. You have to make every decision and they appreciate that. So I do try to alleviate that burden right away. And then along the way, putting in our culture, bringing our team around once in a while, meeting them and just just slowly moving that needle forward.

Tom (00:35:35) - Cory, if we shift just a little bit.

Tom (00:35:36) - You mentioned you're on the cusp of advisory services. Get a couple of questions around that. But we'd love to hear kind of what are you delivering? What does that look like? I think many of our listeners want to move to doing more advisory, and probably would learn a lot from someone who is saying, okay, I'm on the beginning of that. What's that look like for you guys currently?

Cory (00:35:52) - Sure, I'm in the beginning of it to where we are researching how that looks for our firm and how we can transition it.

Cory (00:35:58) - One of some of the battles that we fight, and you guys have already fought this, and I know that, and I appreciate knowing what you guys do. What is your fight is that the client expects that you should be doing that anyway for them and that you're already doing it. And for your 700 $800 tax return fee, whatever it is, everything should be included, should get your entire brain and all your research for that. So that's the struggle that we have is how do we build for it. And so that's we've tried to get feedback from some of our larger clients. We've tried to trickle this out a little bit and see how it would work. We're going to need to tie ourselves up to probably some good software and, and get a couple of my CPAs to really hard focus on it before we roll into it heavy and start putting it out as an option. Recently I've gone into a metropolitan area, and I feel like there will be more ability to grow that service there.

Cory (00:36:55) - And as we get into more cities, we will have better success with that.

Tom (00:36:59) - Yeah, I think what you would probably find is offering something new, like forecasts, is one of the biggest pillars that we offer to people. So I could see if you're talking to existing clients and say, hey, I've seen some things in your return that I could give you some advice, but if you really want us to walk with you in here, we could offer ongoing services. Continue looking forward in the forecast. Right. Think most your clients would have a hard time saying, well, I would think I would get that for free anyway, right? That's a new service you're providing. And you may find you're going to attract newer clients. May be easier than converting existing clients if they're really stuck on. I pay you $800 a year, maybe hearing that this whole package is going to cost you 50 or $60,000, you're going to they're going to plant it. That. But you may have some just say, you know, understood that or someone contacts you and says, my bookkeeper, someone left.

Tom (00:37:48) - Can you do some of these? That could be a perfect opening, but that'd be one advice is kind of what services could you provide and think it is different than just I'm a smart guy who can give you advice, right?

Cory (00:37:57) - And think you're right that more new clients will be up for that and we'll gain clients because of that. And then maybe once that's rolling, then current clients start to see, you know, this is a service that they're advertising and what's this all about? And then they call and then they get the deal and they understand it at that point. But at this point, you know, they just they're calling 2 or 3 times a year randomly with a question. And to them that's their service. And that should be included. And yeah, we do fight that and we do fight the value of what we do to these clients as well. So but think again, the metropolitan areas are going to that's going to take off a little better there.

Tom (00:38:35) - Yeah I could see that.

Tom (00:38:37) - Yeah I like that approach of doing that. You've got a big enough firm. Also think you're at a place where you could say, I could devote a certain amount of resource to really growing that piece of business. And as it grows, keep doing more and more of that. But I think you will find that's really good. And it's interesting that people think it's included. We've done shows where we've talked about we charge for this thing, and then we give away the part that's free. Yeah. Often what you're giving away free is the best advice. That's the part you should be charging a lot for, right?

Cory (00:39:03) - Right. Really tried to stand up for myself a little more even just this year and and you know, I've been at this a long time now. I've got the education. This is what you're going to pay me for. I don't I'm not just going to answer questions on a whim. We're going to do an actual process. We're going to do some forecasting and some planning for you.

Tom (00:39:19) - Yeah.

Tom (00:39:20) - Do those?

Adam (00:39:21) - Are you charging hourly or. Yeah. Sorry, Tom. Are you charging? Like, what's your billing philosophy there at the firm? Do you do fixed fee? Do you do value based or are you doing hourly.

Cory (00:39:31) - So value based is what I've always stood on. Um, taking it back to the acquisitions just a little bit. That can be a struggle because they're all used to something different. And so that's another part of that change is process that we trickle in is getting everybody to a value based billing, if that is a fixed fee for bookkeeping or whatever, but it still needs to be value. The tax returns needs to be value based, not necessarily tying all the hours to it. I've tried to kill hourly billing as much as possible. Basically, if I'm involved with a lawsuit or something, that's about the only time I pull out the hourly billing. But other than that, we try to give a quote or we try to say, you know, this is how much we need to charge for this service based on what we're going to put into it.

Cory (00:40:17) - And we try to just be honest with them upfront as best we can and create a good communication with our clients.

Tom (00:40:25) - That's good. What portion of your returns are value based? This is probably somewhat interesting to our listeners who probably do a lot of hourly basis. So what does that look like within you for our returns?

Cory (00:40:36) - 100% just we do not do hourly based at all for tax returns. Okay. Again, I have acquired some long standing clients. And so if their return didn't change much, I can't, you know, change their fee too terribly much. Last year we installed some minimums just to have some consistency across the board and being in a few different areas. Now I'm starting to see okay, minimums might need to be different in different areas as well. But you know, they're all value based and our minimums probably pretty low where we had a 1040 minimum of 300. But again, we're in some rural communities. And I tried to make it consistent. And some of them from we're stuck in some pretty low rates.

Cory (00:41:20) - So it.

Tom (00:41:21) - Sure.

Adam (00:41:22) - I would say our experience with some of that to Cory was and you can maybe appreciate this is yeah we did the same thing. So it was just fixed fee. Right. But the reason why we did that is I don't know, we're close to like I don't know, we're approaching 15 million in revenue and we've only got like maybe a quarter of a million of that is standalone tax returns, right. That aren't part of our weekly fee. But we've always been just kind of especially whenever we were smaller and scaling. We just couldn't afford for people to have. We couldn't afford to have accounts receivable. We couldn't wait for people to pay us. We didn't do the line of credit stuff, all that kind of thing. So we always tried to just get people to pay us in advance. Well, the nice thing about doing value based billing is you can kind of take that power back, you know? So for us, what we started to do is like whenever we'd send them out and I don't know if you still do it, you probably do it electronically now.

Adam (00:42:13) - But when we'd send them that electronic thing, we would make them send a check in or fill out a form, and it would be right on the back of the envelope, you know, check the box that you remember to fill out your, your banking form and, and so but the cool thing about that was is we were able to send them out. So we always did like a 3 to 10% increase. And we would look at time the next year to see if we got exposed on a client and we'd reset rates for the following year. We'd have them all in a list, send them out with an engagement letter with a dollar amount already sent in, you know, so they could pay us, but we would send them a letter in November and say, hey, well, we increase your price by 5%, but we'd say, hey, you 5% discount if you pay by November 15th. Oh yeah, 2% discount if you paid by December 15th and then no discount if you paid after January or whatever.

Adam (00:43:01) - We got probably at one point. Don't know what it is these days because we still kind of do the same thing, but think we got like 70% or 80% of our money before January, right?

Cory (00:43:13) - Right.

Cory (00:43:13) - Wow.

Adam (00:43:13) - And mean. So we were and we were never sending bills later. So when people dropped off, it was like, hey, your check's not in here. Make sure you bring this back so we can get going on this, you know what I mean? So we always did.

Cory (00:43:26) - That and appreciate that with being up front with the client and making it is sometimes it's like a taboo conversation. Like we're not supposed to talk to them about how much they owe us. Well, just just make it something you talk about. Make sure that they know that they need to pay you for your services. And when I first started, I offered as if they paid for a full year of bookkeeping, I would. This is the very beginning. I would take one month off if they paid up front.

Cory (00:43:48) - That's basically, I think an 8% discount and that was pretty popular, but I was growing very quickly and needed cash. You know, up front, I need cash now to get this stuff done. But that was good. And up to now, what we've really tried to move people to is just a monthly recurring, monthly recurring ACH.

Adam (00:44:07) - And that's what we do for our tax returns. We'll just break them down monthly and it.

Cory (00:44:11) - Seems to be convenient, seems to be just it works for everybody as long as their bank account information doesn't change or their credit card doesn't change, ever. Right?

Adam (00:44:19) - Right.

Cory (00:44:20) - Do some upkeep on it. But no, that's worked out really well for us lately.

Adam (00:44:25) - Yeah. No it's it that was always a good shift. Again, by doing that value based you can kind of pull that back I no it scares some people. Like what do you do if their stuff's way out of control you can always hit the pause button. But I always equated it to, you know, whenever people would ask me, have you ever, ever been to a repair shop for your vehicle? Or they handed you the keys in an invoice?

Tom (00:44:47) - Yeah.

Adam (00:44:47) - No, never.

Tom (00:44:49) - Never.

Adam (00:44:49) - You paid, then they handed you the keys. Yeah, exactly. That was kind of our philosophy in our office. Was like, there's no terms, you know what I mean? It's like we do the same thing and we'll give you a little bit of a break if you pay us in advance. But if not, you know, let's just get that out of the way right away. If you have a problem with that, you don't have to sign the engagement letter. You know, your fee's 2800 bucks. I would get calls in November, get it all squashed, and then we never had to worry about cost ever again, right?

Cory (00:45:23) - And one thing. One thing I've even noticed lately is that there's so much work to be done that we don't have to put up with it. We need to stand up for ourselves, and we need to. Now, I'm not saying demand. I'm not saying be rude about it, but you stand up for yourself.

Cory (00:45:42) - You're worth what you are asking. And if they don't want to engage with you, they can go somewhere else. And likely we had this happen when we put in our minimum. They went out and they looked. They came back, they realized. It's still a really good fee.

Adam (00:45:58) - Unfortunately, sometimes you want to like, bill them away and doubles. You double some of these fee and they're just like, oh yeah, guess.

Tom (00:46:06) - And you're like.

Adam (00:46:08) - That's not what I was hoping your reaction would be. Sorry, I can't afford it.

Cory (00:46:13) - You're kicking yourself because oh all this time they would have paid more.

Tom (00:46:16) - Right, right. Yes.

Adam (00:46:18) - Right.

Tom (00:46:19) - Well, as we close this court.

Tom (00:46:21) - If someone's listening, saying, I love this idea of growing through the acquisitions of multiple office, any 1 or 2 pieces of advice that you'd say, okay, well, here are the couple things you really have to think of to make sure that this is for you.

Cory (00:46:34) - Yeah, I would, you really got to be hands on for a while.

Cory (00:46:37) - You have to get in to that new office. So even if the retiree or the leader there is going to stick around for a while, there's a lot of work to be done for the transition. So you really got to plan on that and you got to physically be present. So, you know, if there's a brick and mortar that is, you know, if there's not, that might be a different story. But aside from that, get to know the people. The people are what matter. And you need to get in there and build that rapport, build that trust with them and the support staff, the leader. Those are what matter in the acquisition, the clients. Yes, of course we want to take care of our clients. They're going to come, they're going to go. There's going to be people that leave just because you got acquired. And they'll be rude about it too. They will just say, you know, we had one person in a small farm town say, I can't be bought and sold like cattle.

Cory (00:47:27) - I'm going somewhere else. Okay. So yeah, I guess I didn't want to work with you anyway, but just be ready for that and don't don't take it to heart because it's going to happen just because people are people.

Tom (00:47:40) - Yeah.

Tom (00:47:41) - The other thing you mentioned that I think you would reinforce is it sounds like you've got a couple pillars that are saying, this is what comes with us purchasing you, and it sounds like your centralized database and the way that's done is one of them. So up front, it sounds like that was an early thing of saying, you know, I'm sure to some extent you have your own culture, but there are certain ways that our firm does things and all the offices do that. And it sounds like you've gotten some really good benefit out of that.

Cory (00:48:03) - And I've honed that along the way. That's what I've learned that I need to be. I need to stand up. For the first few, I had a, my first acquisition. Excellent person, excellent man.

Cory (00:48:13) - I view him as a mentor. I was lucky and he was local and close. So I was able to work with him and really start to iron these things out. And he gave me a lot of advice, he gave me. He had done some acquisitions in the past as well, so I really learned a lot from him, and I've honed this process along the way. So you'll learn a lot after you do your first one.

Tom (00:48:32) - I bet.

Tom (00:48:33) - That sounds like fantastic advice.

Adam (00:48:36) - Great. Yep. Great advice. Yep.

Tom (00:48:37) - Cory, thank you very much. This has been a very enjoyable conversation as I knew that it would be.

Cory (00:48:43) - Appreciate it. Thank you guys so much for having me. Thank you.

Adam (00:48:45) - Thanks.

Outro (00:48:46) - Enjoy this podcast. Visit our website summitCPA.Net to get more tips and strategy for achieving modern CPA firm success. We are here to be a resource in this ever changing industry.