When it comes to making more money, there’s one tactic that’s often overlooked: specialization.
Businesses of all types use specialization to create more value for their customers and, in turn, generate more revenue. The more specialized a product or service, the better it is relative to the competition, and the more a customer is willing to pay.
This is no different for accounting firms. If you want to scale effectively and efficiently, it pays off to fine-tune your vision with a specific idea of who you’ll service and how you’ll do it. Here’s why.
The Benefits of a Vertical Niche
Finding a niche serves your firm in multiple ways. From lead generation to the work you provide, everything improves when you take the time to niche down.
Let’s start with lead generation. More often, businesses are looking for accountants who can provide services beyond your usual deliverables. They want advisors and experts who can help them learn about and understand their operations and financial reporting on a deeper level.
When you find a vertical to service, potential leads see that expertise which gives you an upper hand on your competition.
Then there’s your services. Working within a vertical means scalable processes that apply across all your clients. Rather than customizing your approach based on the industry of your client, you have a template of a process that is easily repeatable.
With universally applicable processes, your team becomes extremely efficient at executing their workflow. More efficiency means more clients that you can easily onboard and start providing stellar work off the bat.
Identifying the Niche for You
Picking a vertical doesn’t need to be a complicated process.
For starters, review the clients you already have and have worked with in the past. Is there any common trend or industry shared between them? That gives you a head start on developing your specialization.
If you’re more of a generalist, start thinking about the types of questions you find most interesting to work with. For example, if you enjoy growth strategies and a touch of unpredictability, then consider specializing in startup accounting.
Another way to approach choosing a niche is by looking at your local industry. Finding what’s prevalent in your surrounding area gives you an opportunity to tap into local businesses for prospecting and networking, which improves lead generation down the line.
For accountants and firms early on in their journey, consider trying your hand with a few different client types before committing. While finding a vertical to service will benefit every aspect of how your firm operates, choosing a vertical that isn’t a good fit does way more harm than good.
An Example of Using Your Niche Expertise
You just brought on a new client: a startup in its early stages of operation. The business started with next to nothing and has had to bring on investment and take on debt to get everything up and running.
After receiving their deliverables for the month, they set up an appointment to talk about some of the key metrics and drivers to help them understand where they are, and where they aspire to be. In particular, they want to set goals to know they’re on track to be successful.
How would you start tackling this request?
When you don’t have specific experiences to draw from, this typically means you need to start researching how startups benchmark themselves and what reasonable goals are. Then you start to compare their financial reporting to these expectations to see if everything is in line.
But when you already have experience in this environment, you skip the step of researching and start digging straight into the reporting.
Developing a niche helps you:
- Benchmark your clients against similar businesses
- Understand the implications of financial reporting
- Streamline setup of dashboards and reporting
- Know what to highlight in your regular touchpoints
Refining Your Messaging
As you start to develop a specialization, you want to leverage it for all its worth. That includes how you market and talk about your firm to prospective clients.
Think about it: if your car broke down, would you want to go to a mechanic or a mechanic who specializes in that specific manufacturer? Both would get the job done but one would likely give you better results and more context to how your car operates.
Leverage your position in the industry by mentioning the number of clients in that vertical that you’ve serviced or years of experience working in that space.
Don’t forget that the extra value specialization brings to your firm is a selling point to your clients. A streamlined setup and efficient workflows translate to quicker deliverables and immediate insights for your clients.
A huge point of emphasis in your messaging should be your ability to benchmark against industry averages and trends.
Business owners obsess over the questions of whether their competitors are doing better or worse and what they are doing differently. Providing answers to those thoughts brings much needed peace of mind.