Block Targets Independent Preparers

[JRS]

"H&R Block believes acquiring or franchising independent tax preparation services represents a great path for growth. The company says it is targeting good performers in the pool of 67,000 independents that prepare at least 100 returns each year.

 

In remarks during the company's recent Investor's Day webcast, Shawn Moore, VP of assisted tax services, noted the target market is limited by that fact that one of four independents reviewed by Block knowingly commit tax fraud."

 

 

http://www.theprogressiveaccountant.com/index.php?option=com_content&id=3874&view=article&Itemid=59

[mcb39]

Oh Please!!!!!   They contact me every year; as does Liberty Tax and, this year, Jackson Hewitt.  IMO, you would have to be pretty insecure before you would hitch your wagon to their horse.

[Jack from Ohio]

I post those letters on the wall in my office.  When asked why I put them up...

 

"They either know my business is very valuable or they want to buy out a real competitor..."

[FreedomTaxed]

It's distressing that HRB is looking to grow their way out of their problems. I know I'm asking for it, but even given that HRB, LTS and JH aren't exactly my competitors, they really need to drop their prices since that's the real direction where the industry must head. HRB needs to find ways to do the same tax returns for a lesser cost, just for starters, since their quarterly losses demand that. But if they can't even drop their prices, then their only option after tripping this badly is to run faster to avoid falling. And that must end badly for them, as well as their clients.

[samingeorgia]

Is this a viable exit strategy, though?  If a guy was knocking on the door of age 70 and wanted out, do they pay a good price?  Cash?  A big problem I see is the lack of young people who are willing to do this work.

[Jack from Ohio]

Is this a viable exit strategy, though?  If a guy was knocking on the door of age 70 and wanted out, do they pay a good price?  Cash?  A big problem I see is the lack of young people who are willing to do this work.

I guess it depends upon what legacy you want to leave with your clients.

 

I would NEVER dump them to the "no customer service" world of H&R.  If you don't care, then it can be a profitable "exit strategy."  My professional reputation is much more valuable than that.  When the day comes I choose to exit, I will interview perspective purchasers and find someone who will provide the same level of customer satisfaction and professionalism as I strive to have.

[mcb39]

I guess it depends upon what legacy you want to leave with your clients.

 

I would NEVER dump them to the "no customer service" world of H&R.  If you don't care, then it can be a profitable "exit strategy."  My professional reputation is much more valuable than that.  When the day comes I choose to exit, I will interview perspective purchasers and find someone who will provide the same level of customer satisfaction and professionalism as I strive to have.

 

I knocked on the door of age 70 several years ago.  I agree with Jack.  I have no desire or intention of quitting yet; but for when I do, I am always looking for some ONE person to carry on my business and my client load.  If the gal I had helping me the past two years had paid attention, she could have HAD the entire package one day.  However, it was either boring, over her head or just not her cup of tea.  I have a new helper this year who is my age; so together we will continue to carry on and keep looking for that certain someone for SOMEDAY.  Jack said it very well.

[MDEA]

I knocked on the door of seventy two years ago also and would look to HRB when time to sell. I have 1700 clients of which only about 250 are personal. I would be happy to br able to receive all my money in one transaction.

[FreedomTaxed]

A big problem I see is the lack of young people who are willing to do this work.

 

Why? In my anecdotal world, I'm seeing younger people willing to take on small companies, but the capital to achieve transfer of ownership is almost totally absent. Hence we see small business after small business just folding up like origami, since the owners got too old and there's nobody to take over.

 

The current owner of my shop has mentioned wanting to buy out competitors; not the majors, like HRB, Liberty and JH, just strip-mall shops like our own. That seems a viable approach since the capital-sized bite for us is small enough to handle.

[FreedomTaxed]

I knocked on the door of seventy two years ago also and would look to HRB when time to sell. I have 1700 clients of which only about 250 are personal. I would be happy to br able to receive all my money in one transaction.

 

The tax-prep industry is one of the most profitable in the nation right now. According to the propaganda gulping that I laughably call "my research" into this sort of thing, practices can sell for 100% to 125% of their yearly revenue. Often, that's just too large a sale amount; for ourselves, at our peak, that would have been $500K to $650K. Is HRB et al really willing to throw down 100% to 125% of revenue just to buy you out?

 

Practice buyouts are often spaced out over time. 4 years seems common. (And it seems like the only way to sell the business to the employees. People who work clerk or part-year positions are notoriously decapitalized in my area.)

[Jack from Ohio]

I knocked on the door of seventy two years ago also and would look to HRB when time to sell. I have 1700 clients of which only about 250 are personal. I would be happy to br able to receive all my money in one transaction.

I guess we have two entirely different ideas of the definition of professional and customer service.