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Research Center >> November 2008
With the economy lurching downward and tax season approaching, small-office and home-office professionals should be prime targets for CPA channel marketers this year. In every recent economic slowdown, the ranks of the part-time and the second-jobholders swell as workers seek to maintain or even expand incomes. CPAs, as independent white-collar professionals, are uniquely positioned to weather a recession by taking on “extra” work. Today, more than one-third (34%) of accountants are already moonlighting in “side” practices or home offices, according to a Bay Street Group survey of 796 accountants and CPAs. About 58 percent of all CPAs surveyed are spending at least 11 hours per week in their at-home offices and half of those are working more than 35 hours a week. Those are astounding numbers, suggesting a vast and largely uncharted market worth billions of dollars. Do the math: Start with a nice round figure of 350,000 members of the AICPA. If 119,000 CPAs are working 11 hours a week at $25 per hour, that’s over $1 billion in billings that CPA channel marketers may be overlooking. Few CPAs talk about it openly. But it’s no secret in the profession. Accountants seem to agree that about a third of all professionals are moonlighting at any given time. But even they might be surprised by the facts.
And they are doing more than just preparing tax returns. Although less than half (44%) of moonlighters say they practice “just mainly in busy season,” 51 percent do so “year-round.” So it’s not just about taxes. Some CPAs run fairly sophisticated consulting businesses as side practices. CPAs explain:
Across the board, accountants in public practice, business and industry and other sectors, who run at-home businesses during time away from their day jobs say the pursuit takes discipline, focus and the right set of tools. “No distractions and no wasting chit-chat with co-workers” are among the things that Aaron Betry, an accountant with a top 100 firm in Milwaukee, Wis., likes about the five to 10 hours per week, he moonlights from home. He also notes that there are no dress codes or parking fees. Clearly, working in a side practice is not for everyone. Simply maintaining a professional posture and appearance can be a challenge.
Frank Schmid, a corporate accountant in Atlanta, who moonlights at home less than five hours per week, says, “I get a lot more done from there.” He is among many moonlighters who would like to increase their work at home hours. What do these work-at-home CPAs need to succeed? Some 83 percent agree that one of the “essential elements” to success is “the right attitude and self discipline.” “You have to have the discipline to do the work,” advises Jon Pope, an accountant with a Wall Street financial services company, who moonlights from home more the 10 hours per week.
While having good technology is important for all work-at-home CPAs, it can be especially vital for moonlighters. Switching gears to moonlight at home at night or weekends is all the more difficult if the technology is not as good or better than what you left behind in the full-time job. “The right technology setup” is considered “essential” by 69 percent of moonlighting CPAs. “It can be difficult to get back in front of the computer and focus on work after nine or 10 hours doing that same thing,” says Stan Chaplin of Waukegan, Ill., who moonlights at home five to 10 hours per week after his day job in management accounting. “If you don't have a good set up it (working at home) may be counter productive,” warns public practitioner-moonlighter Lisa Keane. With the right setup at home, she adds that moonlighters will realize “better production and concentration, less distractions from co-workers and accomplish more without the hassles of commuting.” Smart work-at-home CPAs are keenly aware that they can leverage proper technology at-home. Keane is among 10 percent of the moonlighter CPAs who said that in addition to the moonlighting, they also use their home offices to occasionally handle duties from their full-time day jobs. “Sufficient bandwidth is extremely important,” says Jerald Betts, who uses his home for both moonlighting and to handle items from his full-time job with a local Wichita, Kan., CPA firm. In other words, one of the first things CPAs do when launching their moonlight career is to upgrade from dial-up. Catherine Mulder is enjoying moonlighting success in Iowa in part because her at-home technology is better than what’s available in her day job. “Better computer, desk setup and copier availability,” she boasts, adding, “It’s also great to avoid the constant phone calls and walk in questions.” Even with the best technology, it can be tough to be serious about moonlight work with the family around you. “Family can constantly interfere with work, and since you are home they feel that you can walk away from it at a moment’s notice,” says Joaquin Bello, who runs a Miami area public practice in addition to duties as an assistant finance director at a local university. “Definitely have a separate office or room where you can separate your personal and business life.” Charles C. Strawbridge, who moonlights from a day job in business and industry, says other moonlighters should first meet with their families to establish rules “regarding sanctity of work space and time requirements for practice versus ‘emergency’ home matters.” Marketers need to look broadly to find these moonlighters. Although they practice as public accountants, four in 10 categorize themselves as members of business and industry. Many already work in small and medium-sized offices. And more than half have C-level titles in their day jobs. That makes them double-barreled decision-makers. RICK TELBERG is AICPA Editor at Large and president of Bay Street Group LLC. FOR MORE about CPA Trendlines research from Bay Street Group, contact Rick Telberg at (914) 674-4531, or by e-mail here. |
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The
Billion-Dollar Secret CPA Market