How this Cost Accountant & CS went from working at a BPO to running a successful practice
- Hi, I am Prasanna Venugopal, a Cost Accountant and Company Secretary from India.
- I was born into a lower-middle-class family and pursued my education against all odds. In fact, I am the first qualified professional in my family.
- In 2013, at the age of 29, I quit a well-paying job at Bosch to start my own Cost Accounting Practice - Prasanna & Associates.
- Here is my story of how a boy born in a lower-middle-class family went on to start his own Cost Accounting practice and now has a team of 15 and serves 40 clients.
Taking Up Cost Accountancy against all odds
I was born in a lower-middle-class family where even providing basic amenities for my family’s sustenance was a major hurdle. In 2004, while still in college, I started my professional career as an audit assistant. During this time, I had the personal trauma of losing my father. I was now the sole breadwinner of my family with the first payslip of INR 850/- per month ($20). With meager earnings, I was able to provide my family for their sustenance...it was quite a challenge for me, but I firmly knew that it was not the end of the road. While working at the audit firm, my dream was to start my own firm and engage and support big corporate houses in areas such as cost control, develop dedicated tools for cost reduction measures. In 2003, my exposure to management theory was a game-changer in my life. SWOT analysis became an everyday exercise and in due course, it became a ritual to every facet of my life. My inquisitive urge to understand “How cost-effectiveness will impact one’s life” fueled my passion to pursue a cost accounting course. When the situation was bleak and the future was unknown, I persevered with passion for cost accounting and enrolled for the CMA course from The Institute of Cost and Work Accountants of India in 2004. This is how my journey started.
Working full time & pursuing professional courses like CMA and CS
Fast forward two years later, in 2006, after graduation and passing the foundation course of Cost Accountancy, I joined a BPO firm. This time I managed to add a little respect to my payslip…a sum which was quite substantial for my mode of living! I was now juggling my studies and work. Another two years later, after completing my CMA Intermediate level in 2008, I enrolled as a student with the Institute of Company Secretaries of India. I took CS to shift gears to legal & secretarial matters. Simultaneously, I completed an MBA in 2008 through a correspondence course. This helped me get my first break into a manufacturing company (BOSCH Ltd)…a bright opening in my corporate career. My interest in costing was soaring as ever and in a short time of 8 months, I accomplished greater results for the company. I also upgraded my skillset by learning SAP especially the FICO module (which later paid me the extra dividends in my practice, more on it later!). I faced many challenges during my entire cost accountant study. I was never given a special grant to attend my exams and neither did I bunk my workdays for it. Finally, I qualified as a CMA in 2012 & CS in 2013, an 8-year long journey…which usually takes roughly 2.5 years, from the date of enrollment.
Taking an entrepreneurial leap and risking my livelihood
I was never fond of Big 4 firms and moreover the need for cost accountants in those days was extremely limited. Also, I knew the corporate culture and the nuances of how it functions. It requires incredible luck and time defining moments to showcase your skills to get recognized in the system! All of this instigated me to step into my practice, putting my financial status back to square one and that was a concern that I had to focus parallelly. Considering this scenario my appetite to take risks at the moment was low but I knew I could pull this off by taking a "calculated risk". However, I was yet again put in a spot when my company gave me options to revisit my plan. They increased my perks and offered a pay hike of 60% more than the salary drawn, close to $25,000, which was way ahead than the industry standards. I took a firm stand on what I wanted and was relieved reluctantly from my company but this created a lot of opposition from my family and friends, as they did not want me to struggle and start all over. But I knew it was time to look at the wider picture and I was sure this risk would pay off eventually in the longer run.
Bootstrapping my business & getting in a debt trap
I started my practice in 2013 at the age of 29, with no backing or financial support. I hardly had any savings. So, for my family’s sustenance and support, I borrowed money from the bank and invited myself for a debt trap. Now, all I had was a couple of thousands (which I loaned from the bank) and self- motivation.
First 6 months was a phase of turbulence and vacuum
I knew the practice was very tough but still, I never reached out to my peers or known acquaintances for any help (both professional and personal). I had a vision and a concrete plan to move forward and achieve my expectations. Within a week of starting, I approached nearly a dozen mid-size and large corporates for cost assignments but there was no response. Eventually, I got a chance to meet
a few potential clients, however, when I went to meet clients they were a little startled to see a young man giving strong suggestions from a business point that other consultants seldom did not offer. So initially, my age was another concern for companies to engage a young person for this task, but I knew my strengths and weakness and kept pitching client after client. I now had zero clients and my debt indicator showed an all-time high but my perseverance to scout customers never stopped. This trend was continuing for the first 6 months and post that this became my chosen lifestyle. After 8 months of arduous battle, I finally got my first billing to implement the SAP CO module. My customer wanted a COPA (Costing Profitability Analysis). My first breakthrough was for INR5,000/ per month ($100) with 4 mandated visitation and consulting.
No Turning Back
In 2014, a Korean manufacturing company in Chennai opened up with the exact requirement aligning with my offering. This was quite unusual during that time but was a great feeling to have acquired that account. My first assignment paved the way for another project, which was their sister's concern. The project they offered was for internal audit and cost audit. The managing director was in all favor to implement COPA implementation (in SAP R3) in their sister company as well. My revenue started flowing from here and my succeeding breakthroughs happened through word of mouth. I was the first to get empaneled in Public Sector Banks which came in time and handy to meet all my expenses. The need for any breakthrough requires perseverance and patience’ and this paid off well for me. All in all, I believe it was worth the risk and it paid off well...and from here there has been no turning back.
Growing The Business: The Complete Timeline
- 2003 was my toughest year. I would put it this way, as my day-to-day activities came to stand still when I literally had no financial support.
- These were times when you understand that life pushes you to the end of the cliff, by making you doubt your own decisions.
- I had no choice but to keep calm and do what was left in my life.
- During this time I qualified as a CMA, CS, did an MBA (correspondence) all while working full time.
- Started my own practice, against all odds. Took a heavy loan from the bank and started.
- I’ve been SWOTting my whole life and I knew what the client wanted to see and I exhibited those qualities fairly well and I earned me a big breakthrough.
- Got my first client after 8 long months.
- In 2014, a Korean company hired us. This provided great opportunities.
- I also joined as a part-time lecturer in a college to teach costing and management accounting.
- My remuneration was INR 750/ -per hour ($15) and I had no choice of leaving that bit...back then every penny mattered.
- Though I had time constraints, I thoroughly enjoyed teaching and it did provide me a safety net of cash inflow.
- This year, I had to manage my funds, clients, family and last traffic, to reach college on time without skipping my lectures.
2015 (Bank/ VAT Audits major money-spinner)
- Cost audit/ Internal audit, Bank assignments/VAT audits were my major money-spinner which helped my company reach a considerable revenue road map. Also got empaneled in a bank.
- Our offering was quite a new flavor in the market, which led varied companies to open doors for us.
- Got a new project with a cardboard manufacturing company, where I successfully implemented the job costing in TALLY ERP. The client really liked my work and offered me a consultation role to help them make the right decision!
- My travel was 7 hours by road and 5 hours of productive session at the factory premises...but it was worth it!
Diversifying in M&A
- Somewhere amidst all this rumble, I also realized my corporate law skills were put into less use and underutilized. I could also get into M&A.
- I worked on the same.
Increased clients and earnings
- Withing 2 years of practice, I was earning close to $ 3000 / month and had close to 11 clients.
- My part-time lecturing eased me from my chaotic lifestyle and relaxed my mind...I was now pursuing teaching more because I enjoyed it rather than the money.
- GST implementation in India, facilitate cost accountants to give more value additions to the corporates especially on complicated tax structure and revenue reconciliation.
- Small traders who fell under this GST bracket became my key clientele.
2017 (Major breakthrough) Project in Indonesia
- The largest steel manufacturing company requires cost control measures for their 12 business units in Indonesia. This was my first 'Overseas opportunity' in the APAC region.
- The project lasted for 8 months and I successfully implemented cost control tools to all their business units and suggested cost reduction measures.
Missed opportunities in India
- My long stay in Indonesia for this project ate up much of the revenue stream in India.
- Since I was the face of the company, I missed a bag load of opportunities during my 8 months of overseas visit
- On my return to India, all that was left for me was a handful of cost audit clients.
- My earnings were approximately $7000 / month.
- Things were quite stable and I had roughly 18 clients.
- One of the major MNC approached me for a cost audit as well as costing assignments in SAP R3.
- My earnings were approximately $11000 / month and had roughly 23 clients.
- Midsize Information technology company approached me for a project-wise costing. I was well informed on the client’s requirement and I delivered with ease.
- The managing director offered me a role as an external CFO.
- During this time, I had an opportunity to launch their new product at NASSCOM Technical Fest GITEX held in Dubai - Abu Dhabi.
- I am investing COVID time to develop a costing module for 5 different sectors.
- Stand-alone costing ERP product which will sync up with any financial ERP in the country. Though the product is complete, we have still some portions to revise and it’s currently deployed for a beta customer.
“What advice would you give other Cost Accountants who want to start their own?”
The key is to assess your own skills and be well informed on customer and market intelligence.
“Who should opt to be a Cost Accountant?A big opportunity to create value in an enterprise lies in making the best or most effective use of a situation or resource. A person who has great accounting skills, with deep insight in cost analysis and is able to count every organizational prerequisite in an ethical way is the best fit to be a Cost Accountant.
"Integrity."My entire clientele is built on referrals and through word of mouth from my business circles. I generally do not engage with the client unless I sign an NDA. Maybe, this trait of integrity is well appreciated by the business fraternity. This aids me to set up a steady client base. And, I wish to keep it in this manner.
The skills of Cost and Management practitioners are per se well known but what gives the cutting edge is your acumen to understand your customer and offer a solution that is very quick and best. The reason for my steady growth is a combination of my educational qualifications and experience over these years and how I applied all of it for my clients’ benefit. Cricket is my favorite sport and I play regularly. I have transformed into a better leader; a better human being and I owe my credits to the game of cricket. A ‘never give up attitude’ of the Aussies is my MANTRA. Prasanna Venugopal is a competent dynamic Individual with over 16 years of rich experience in the field of Finance, Costing, Legal &Secretarial. His firm Prasanna & Associates specialize in Cost Audit, Cost Optimization, Product Planning and Budgeting, Business Planning, Bank Audits, Financial Audits, Legal and Secretarial Compliance.