Richard Kopelman | Executive Profile | ATLANTA TREND
A Next Generation Vision for Accounting
By Karen Rosen
Richard Kopelman never anticipated becoming a national expert on manufacturing and distribution when he studied accounting at the University of South Florida.
“I went into accounting because it’s the language of business and I figured it would be a great backbone,” Kopelman says. “I could use it no matter what I did in business.”
Now he’s the CEO and managing partner of Habif, Arogeti & Wynne (HA&W), the largest independent accounting, tax and business advisory firm in Georgia.
HA&W is the largest independent accounting firm in Georgia and will gross over $65 million in revenue this year. HA&W has clients headquartered in 36 states and does business in more than 40 countries.
Kopelman is also the founder and chairman of Next Generation Manufacturing (NGM), an organization that shares best practices among the industry’s chief executives through programming, education and networking.
“NGM has really become a great tool for companies in Georgia,” Kopelman says. “It’s a lot of work, but it’s fun and it’s a passion.”
Kopelman joined his older brother Mitchell at HA&W in 1992. Five years later, he was a manager helping a couple of partners with some manufacturing clients when he came up with the idea that would shape his career.
Kopelman found his work with manufacturers challenging and enjoyed “the fact that I could touch what we were accounting for and you could see what was actually being produced.”
Though his partners were skeptical, Kopelman convinced them to bring back HA&W’s manufacturing and distribution practice. It had been robust in the 1960s and 1970s, but lapsed when many companies along Fulton Industrial Boulevard went out of business or were sold.
“My partners told me there was no manufacturing community here,” Kopelman says. While they were right about Atlanta, he did his research and found 10,000 manufacturers in the state of Georgia.
“I figured, ‘Why not?’” he says. Starting with about 25 clients, the manufacturing and distribution group that increased to over 275 by the time Kopelman handed off the division in 2013 to become CEO. The group’s revenue grew by 800 percent since 2001.
Kopelman was introduced to the “Theory of Constraints” and Lean Manufacturing through Georgia Tech and the Goldratt Institute, and learned how to apply these techniques to accounting to help companies increase profits by as much as 500 percent.
“Oftentimes modern-day financial reporting gets in the way of smart business practices and driving profits in a manufacturing environment because it tells you to do the wrong thing,” Kopelman says. “And so we started looking at that and how we can apply that with our clients to help them make more money and keep more of it.”
Kopelman stresses what he can do FOR clients, not what he could do TO them.
“I think most accountants are technicians and they talk to their clients about what they’re going to do to them,” he says. “They’re going to audit them; they’re going to do their taxes.”
“When we’re talking to companies, we at HA&W say ‘These are the questions we think you should be asking and these are the types of things you should be focused on. What are the benefits?’
“If all a company is getting is their tax return completed, and they look at that as, ‘That’s my benefit,’ then they have no expectations.”
HA&W get involved with planning well before returns are filed, touring the plant and understanding operations and trends in the market.
As an accountant, Kopelman doesn’t go by the numbers; he’s an innovator. “We’ve always considered ourselves and our clients consider us entrepreneurs serving entrepreneurs,” he says.
Kopelman was introduced to business at an early age, helping his mother sell pre-arranged funerals. A latchkey kid at age 12 in southern Florida, his mother kept him occupied after school by giving him a script and a list of people. ” I would call up and make a sales pitch to get her an appointment to go see elderly people in Miami,” Kopelman says.
He made 30-50 calls a day, the potential customers never realizing they were talking to a kid. “Once in a while, they would say, ‘No, ma’am, we’re not interested,’” he says, “which was kind of tough for a 13-year-old boy to live with. But I got paid for every appointment she got and every sale she made.”
At 14, he started his own business washing and waxing cars in his neighborhood. Kopelman had a route of 20-30 customers each weekend.
He worked his way through college, then moved to Georgia, whose business environment he liked better than Florida’s.
At that time, HA&W had 80-90 people on staff. Now it has 322, including 44 partners. “Every partner always says that the firm started growing when they started working here, and I’m no different,” Kopelman says.
HA&W also was not highly specialized when he arrived, with each partner doing every kind of service and industry. When the firm reorganized into specialties, Kopelman helped engineer the success of many high-growth businesses in the areas of manufacturing, distribution, transaction processing, service providers and insurance agencies.
As an example of putting lean manufacturing and the Theory of Constraints in practice, HA&W worked with a domestic company that was losing money on a regular basis.
Most of the other products within its category came from China.
“Their advisors at the time were simply doing modern financial reporting calculations,” Kopelman says, causing the company to overprice its product and lose out on bids.
It turned out the company had stopped running six machines because it thought the overhead was too high. However, each machine required only one employee to operate it and the “throughput dollars” made the company competitive in the bid process.
“That was an easy way to find an extra $50,000-$60,000 a month in gross profit with no additional overhead, no additional costs at all,” Kopelman says. “I believe there’s a tremendous amount of confusion out there in terms of how to price product.”
But most companies don’t have a room with machines sitting idle, do they? “I think you’d be surprised,” Kopelman says.
HA&W also makes sure clients take advantage of the tremendous manufacturing incentives and credits at a state and federal level.
“According to the survey we do every other year with Georgia Tech, over 75 percent of the companies report that they have not taken advantage of the credits they’re entitled to,” Kopelman says.
Kopelman has helped clients recover millions of dollars in federal and state tax refunds targeted as incentives for all types of companies across the country.
From 1999 to 2001 he found time to serve as a part-time CFO for a technology start-up that allowed small-town insurance agents to write contracts with the big players through an online portal. HA&W is still an equity holder in the business.
Kopelman willingly shares his insights into the manufacturing and distribution world. He has written articles for trade and industry press and has been quoted in the Wall Street Journal, IndustryWeek, Manufacturing & Technology, Food Manufacturing, Plastics News, Accounting Today and the Atlanta Business Chronicle. Kopelman also has been interviewed by National Public Radio, Fox News and WSB.
He founded Next Generation Manufacturing because he saw a need for an association that was not politically-driven or run by lobbyists and could help companies grow and create more innovation.
“I didn’t see anybody really just focused on business and bringing a large number of C-level executives of manufacturing companies together,” he says.
Kopelman also didn’t think companies were aware of the offerings across the state including the Georgia Manufacturing Extension Program at Georgia Tech (where he served on the board), Georgia Quick Start and others
They told him, “That’s a great idea. GA Tech doesn’t have any money or resources, but if you want to put it together, we’ll host it.”
“That was either a threat or a promise, I’m not sure which,” Kopelman says.
The program launched in 2011, with 200 C-level executives representing about 150 manufacturing companies in North Georgia. The fourth gathering will be this September.
The manufacturing and distribution division was a well-oiled machine when Kopelman handed it off to become CEO. Reluctant to let it go completely, he keeps a hand in by working with half a dozen clients as a strategic advisor.
In the middle of last year, HA&W started lean practice inside its own firm to improve how it delivers services to clients.
“We expect to see within the firm a 20 percent improvement in terms of delivery speed of the final product to the client,” Kopelman says.
As managing partner, Kopelman wanted to build on the legacy left by his predecessors.
He and his fellow leaders decided to put a framework around the firm philosophy, operating from a cultural perspective on four pillars: Trust, transparency, communication and collaboration.
“We also wanted to create a ‘best places to work,’” Kopelman says. “We weren’t focusing on being on a list, but we wanted internally to view HA&W as a best places to work -- a place where everybody was emotionally committed not just to the organization and to each other, but to our clients as well.”
The firm has an annual spirit day where they spend some time “talking about who are we and where are we going as an entire company,” Kopelman says. They spend the rest of the day volunteering in the community.
Employees are encouraged to volunteer throughout the year as well and HA&W was named United Way Corporate Partner of the Year at its annual breakfast in April.
“People always say, ‘Do you want to be a $100 million company? A $200 million company?’” Kopelman says. “I want to be a company where people are thriving and we’re creating upward mobility and those milestones will be markers along the journey.”
HA&W is professionalizing its sales and marketing efforts in an effort to grow its traditional services at a 10 percent clip. The goal is to grow the consulting services practice -- encompassing business evaluation, dispute resolution services, mergers and acquisitions and information assurance – five-fold over the next five years.
In the “everything but the audit” category, HA&W is working with Fortune 100, 500 and 1,000 companies in areas such as mergers and acquisitions, tax credits and information assurance.
The firm has also expanded its international service offerings through all of its industry niches. “One of the unique things about our firm is that we have 70 people out of our 320 folks who speak 26 different languages,” Kopelman says.
A partner is devoted to Japan and Korea and a future partner to Germany. HA&W has even brought in its first non-CPA practice leader who has a history of growing professional services firms in the technology space and an attorney to grow our State and Local Tax Practice.
“It’s a very different approach to what we’d historically done and what most CPA firms do,” Kopelman says. “We’re a CPA firm, but at the end of the day, we’re a business.”
Kopelman lives with his wife and three sons in Sandy Springs and they enjoy active vacations. In his spare time, he’s teaching his 15-year-old twins to drive, plays tennis and enjoys any activities with his children.
A deep-sea fisherman, Kopelman has made five trips in search of the blue marlin. “I have seen the elusive blue marlin in the water,” he says, “but have yet to hook one.”
He won’t give up, though, and the numbers are in his favor.
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