Improving Your Focus With a Niche Accounting Practice
There are many opinions on whether accounting firms should offer services to specific vertical industries and unique audiences. Some firms believe that if you develop a niche, you may limit your opportunities for more business. Generalists, on the other hand, want to be all things to all clients, so they offer services to a broad group of industries and types of companies.
We believe having a niche - or just a couple niches depending on the size of the firm - is a great way to grow because it positions you and your firm as "experts" in a very crowded marketplace. Comparing apples to apples, if you have two firms that seem to be the same, but one has a long history of helping clients in the healthcare sector, which firm do you think a doctor will choose as his or her accounting firm?
Kaye Singer, a business coach from Portland, Ore., writes about niche marketing and suggests this three-part self-assessment. She says a good niche provider needs to be focused on clients who:
1. Have a strong emotionally compelling problem or issue.
2. Want positive results that will make them feel much better or solve a problem.
3. Are willing to pay for the services or benefits they receive because they see the value to their life, business and/or happiness.
A generalist firm can certainly address these three questions, but a firm that specializes can get much more specific as to how their services help clients grow their companies, reduce tax liability and survive for the long haul.
Often, firms create niches organically without any real strategy or forethought to specialization. Eventually, once the firm begins to think about referral sources and monthly billings, the firm realizes it is, indeed, focusing its resources on one specific area.
Although this may seem obvious, many accounting firms can't see the forest through the trees to realize they should focus on what they know instead of what they don't know. It is this intellectual capital in one or two specific areas that enables a firm to develop a niche practice.
For example, if your firm's partners and staff have experience in international accounting engagements - either learned on the job or when they came from previous employers - the firm will probably want to develop a niche in international tax or accounting. The same thinking holds for an industry niche. We've mentioned healthcare, but just think of all the SIC codes and corresponding industries. The playing field is wide open, especially if you or your staff have experience in a specific area.
Once you decide to specialize and want to proceed with this niche, the next logical area of focus is marketing. Specifically, how will you let referral sources, clients, prospects, friends and family know what you're doing?
This is actually the easiest part because you have a very specific skill and knowledge set to talk about, and it's actually much easier to talk about a niche practice than it is to promote a more general jack-of-all-trades accounting firm. You also have a much more specific audience to market to, so rather than trying to target all industries with all of your services, you can drill down to an industry segment.
A niche accounting practice isn't for everyone and it certainly takes some work to develop a thriving business, but more often than not, accounting firms that niche have a much more focused, decisive strategy and long-term outlook.
By Hugh Duffy
About the Author
Hugh Duffy is co-founder and chief marketing officer of Build Your Firm, a practice development and marketing company for small accounting firms. Hugh teaches in an online Accounting Marketing Program, and helps accounting firms with developing niches in their practice. He can be reached at 888-999-9800 x151, or at email@example.com.