Are we entering the age of the ‘small’ CPA firm?
Everybody is talking about the megatrend of the consolidation of the CPA profession into megafirms as we see major mergers of equals (e.g. Reznick-Cohn, Clifton-Larson). The AICPA showed a decrease in the number CPA firms over the past five years from 47,000 to 43,000.
But is there a counter-trend reversing that tide, hidden by the retirement of the baby boomers who own many of those small firms?
Futurists often say that for every major trend, there is often a series of counter trends that move in the opposite direction. I think we are seeing that right now in the CPA profession.
Here are three reasons I think we are entering the age of the small CPA firm:
- Fallout from merger mania as large firms and small practices without succession plans are merging at an ever increasing rate and often starting back up as small firms.
- Layoffs in the corporate (or business and industry sector) due to the extended recession, which is creating a new small practice focused on providing CFO-for-hire services to small business as former CFOs and controllers are offering their expertise to small businesses instead of just working for one employer.
- The emergence of small practices with technology-savvy professionals who work anywhere, anytime and are focused on providing higher value to their small to mid-size business clients. The technology is leveling the playing field for small practices.
What do you think? Are we experiencing the age of the small firm?
We at the MACPA will be working to connect with and support our small firms even more as we see this evolution (revolution?) occur.
There is a saying (and a book) that I think is appropriate for this new era: "It' not the big that eat the small (anymore), it's the fast that eat the slow!"
See my post, You Must Be Present to Win, in which I featured a few of these small, fast firms, and Open Integration: Holy Grail of the DATA Revolution by Bill for the latest in the technology supporting small firms.