The 15th largest US firm has agreed to exclusively adopt the Baker Tilly International brand.
Virchow Krause & Company has been an independent member of Baker Tilly since 1999. The firm has 1,300 staff across offices in Chicago, Detroit, Minneapolis and the state of Wisconsin.
Virchow Krause is the largest US firm in the Baker Tilly network and reported fee income of $202 million in its most recent financial year. The firm is also one of the fastest growing in the US, increasing its revenue from $28 million to $202 million in just ten years.
Virchow Krause chief executive Tim Christen told the International Accounting Bulletin the unanimous decision to adopt the Baker Tilly name was motivated by a desire to globalise the firm’s image.
“Today the struggle we face with our clients is we seek to help them in a different venue, be it a different state in the US or different country,” he said.
“We need to overcome the brand implications of using a firm with a different name. This serves as a clarifier, Baker Tilly International is a global network and the firms are able to work seamlessly throughout the world.”
Christen believes more large independent US firms will adopt the branding of global accountancy networks. He said the large regional firms that choose to remain independent run the risk of being left behind.
“There are a limited number of global brands of the quality that a large firm would want to accept as their own brand. Baker Tilly is one of those but there are not an unlimited number,” Christen said. “The middle market service firms behind [the Big Four] will enjoy an advantage over regional local firms that do not have a global brand. This is an opportunity for Baker Tilly as a network to firmly establish itself in that strata of firms. I expect to see a few other networks try to do this too.”
Virchow Krause will establish a timeframe for the name change once it has been approved by US regulators. The re-brand will be supported by a massive marketing and advertising exercise in the US markets Virchow Krause serves. As the firm has a 77-year history, Christen accepts there are risks the re-brand could impact upon the goodwill established by the Virchow Krause brand. He said management would need to ensure the transition is smooth.
Baker Tilly International has more than 20 independent member firms in the US. Christen said Virchow Krause adopting exclusive Baker Tilly naming rights had caused apprehension, but not tension among other member firms.
“I believe there is a common belief and understanding among all the network members that this move to strengthen the Baker Tilly brand will be beneficial to all network members,” he said. “I think there is the potential for some Baker Tilly independent member firms to merge [with Virchow Krause]. There is no compulsion for firms to do that but that could be an opportunity.”
Baker Tilly International chief executive and president Geoff Barnes said Virchow Krause was a logical choice to wave the Baker Tilly flag as it is the largest member firm in the country. He said there has not been any fallout from other disgruntled US members and the branding will not conflict with Baker Tilly North America – an internal umbrella term used for the group of member firms in the US, Canada, and the Caribbean.