Writer: Max Crampton-Thomas
2 min read April 2021 — In an interview with Invest:, Reynold Cicalese, a managing shareholder of regional, full-service accounting and advisory firm Alloy Silverstein, headquartered in Southern New Jersey, said he has seen the last year of the pandemic as an opportunity for growth as virtual and remote working allows the firm to serve clients nationwide.
What was the greatest lesson learned over this past year and how is that lesson being applied in 2021?
I think the biggest lesson is that over the last year we realized our market is no longer limited to our local zip code. Because of the virtual, remote environment, with Zoom and FaceTime or similar virtual meetings, we have gained more clients around the country than we would have ever thought. In the past, we have had clients from around the country that were based in South Jersey but now our market has expanded because they’ve gotten very comfortable with representations that are virtual.
During the last year, what has separated Alloy Silverstein from its competitors?
It has been a weird year. During the first round of PPP loans, we were in a lot of meetings and we helped to get our clients and nonclients about $35 million in PPP loans. When you consider the average loan across the country was $50,000, that is a pretty big sum. What has happened in the market is that people have realized there’s a big difference between a CPA firm, an advisory firm, and somebody who prepares taxes. I was in a lot of meetings as a CPA with potential clients with their representation and their tax preparer because that potential client didn’t feel comfortable that his representation knew the answer. I think a lot of people realized there were flaws in their representation.
Where are you seeing businesses or potential clients making mistakes or showing inefficiencies?
Regarding their representation, some people are still shopping by price and not by expertise. Over the next year, you may find that after the PPP 1 and PPP 2 there may be more businesses going bankrupt. Individuals or firms that live week-to-week, need cash flow or may be stumbling or highly leveraged companies, I believe they are going to be in jeopardy over the next 12 months. I’m curious to see how the market for office buildings plays out. I believe that over the next 12 months we’re going to see changes in office space. We could see a lot of people staying remote or changing their philosophy about how to run their business, whether they should be remote or if they should have one centralized office for all their employees or if they should have three offices. There is still uncertainty as to how this is going to play out, especially for retail which has also been greatly affected by the pandemic.
What is the net, overall effect going to be of the government stimulus between those that succeed and those that are struggling?
There has been a lot of assistance to individuals and businesses over the last year. Sooner or later, somebody has to pay for it. I would think that when you look at what is going to happen over the next 12 months concerning the tax plan, that will dictate how well people get out of this. You have to look at how strong businesses are and who’s going to pay for all the assistance in the long run because when I started in this business, the tax on investments, dividends and interest was 70% and a W-2 income was maxed out at 50%. When Reagan came in and changed all that, I saw what growth was. The concern I have now is how they’re going to pay for all the money that has been released into the economy. The money was needed but somebody has to pay for it and the question is if the businesses that are doing well are going to take the brunt of that. That is the concern.
Which industries in South Jersey have really strengthened and are growing despite the challenges of the pandemic?
I think home improvement and construction are doing well. Everybody has been in their house for a whole year, and they realize that their properties need to be adapted to the new situation. Because everybody is seeing the flaws in their homes, contractors are doing well.
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