4 Accounting Practice Management Strategies to Narrow into a Niche

Katey Maddux
Founder & CEO of Millennial Accounting

Practice Management, Development

Many people think accounting is a general profession, like a primary care doctor; they cover anyone and everyone. And while a business can use a general accountant, there is so much more value to be found in a specialized accountant, one who works in a specific niche or niches. Specialized accountants learn the systems, processes and languages of certain fields of business, and therefore have more wisdom and experience with which to advise businesses in that particular niche. Choosing a niche, however, can be the difficult part. Deciding which niche and why can be overwhelming, so here are 4 ways to dive into how to niche down your accounting firm.

  The natural niche

Start with the business you already have. Are there clients in your client portfolio that are in the same industry? That can be your starting niche. Analyze the businesses and look for what they have in common, as it will give insight into what that industry often deals with.  Another area to consider is partner niches. An accounting firm that’s working with construction companies might consider taking on plumbers or other skilled tradespeople, as they will not only have similar accounting, but it’s a good way to get referrals, as the business owners from one often know the business owners of the other. When deciding if it’s best to stick with a niche you already have, consider things like what technology and systems are they using, do their systems sync to your accounting software, do they have payroll, do they have payment processors, what kind of assets do they have, etc. Then consider if you like working with those nuances.  If so, consider that your first niche!

The experience niche

Assuming most of you weren’t born accountants, it’s time to think about what industries you may have prior experience in.  Literally any industry you had experience in before going into accounting can be beneficial, because understanding a client’s world is easier when you have been there. Think back not only to prior careers, but even back to high school or college. Retail, restaurant or child care experience could all play into helping advise someone in that niche.   Consider the careers of parents or other family members, or even your childhood environment. For example, growing up on a farm would give someone an understanding of the agricultural world. College classes in human services or education may have opened the door to working with private schools, non-profits, social workers or therapists. If you have a team working under you, consider asking them about their pasts. They might be able to specialize in something you couldn’t.

The hobby niche

Is there a business or side hustle that you always wanted to start, but never had the availability to do so? Picking up this industry as a niche can make your job just straight-up more fun. Did you always want to do photography? Try taking on photographers as accounting clients. If you’re considering getting into investment properties, try doing the books for property owners or property management companies. Love tech-start ups? Start taking them on as clients.  Realizing this might require more homework to get started, this is a great way to get to know an industry that you love. Be sure to do some background work before taking on clients if the industry is completely new. Research topics like ‘chart of accounts for hair salons’ or ‘accounting for tech-start ups’ to get some insider knowledge on costs or business procedures they may have that would be new to you. This will help not only their accounting, but it will also help you speak their language and better connect with them on a personal level.

The geographic niche

Last but not least, this niche is right outside your door. Sometimes it’s just best to go where the money (and the business) is. Think about what your city or state is known for.  Are there a lot of businesses in a specific industry where you live?  Think coffee breweries in Seattle or oil companies in Texas. The spectrum can be as broad or as narrow as you make it. If you live in a heavy tourist area, consider restaurants, hotels or travel agencies. This strategy can work especially well for brick & mortar accounting firms, since locality can be more of a focus than for online firms. This approach to niching can also partner well with community service and social responsibility.  Offer ‘local discounts’ to customers in your zip code, set up a ‘giving back’ donation program, or build rapport by volunteering in the community. While this can be done with any niche, it will especially help you stand out in your geographical location.

If there’s one thing to remember about choosing a niche, it’s that you’re not writing them on stone tablets!  Your niche can change, either on its own, or by design.  If you start in retail and realize that you don’t like dealing with inventory, quit taking on retail clients and try out another niche. It’s also ok to have more than one niche. Some businesses have two or three, especially if they are a larger firm or have team members that specialize in different industries.  Be flexible and give yourself (and your team) permission to try something new.  Your findings may surprise you.

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