Choosing the Best Accounting Niche in 2021
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Choosing a particular niche to specialize your accounting firm in is essential and vital to your business. Although several firms provide general accounting services, tax and accounting firms are growing at the fastest rate because they develop and market themselves to serve a specialty accounting niche.

An Accounting Niche Can Be More Profitable than General Practice Accounting.

When starting your accounting firm, finding a niche to specialize in is important. Accounting is often regarded as a general profession, so many companies try to appeal to all businesses. The issue is that each business operates in a completely different manner; the terminology, ideas, and clientele are all niches. This is why specializing is more profitable. You would be more useful to them than a general accounting firm.

Advantages of Choosing an Accounting Niche:

Competitive advantage—you would be able to talk to specific companies and speak their language easily and fluently.  This makes you more appealing, even though you charge higher fees than general accounting firms.

Advantages of Choosing an Accounting Niche:

Competitive advantage—you would be able to talk to specific companies and speak their language easily and fluently.  This makes you more appealing, even though you charge higher fees than general accounting firms.

Higher ROI Marketing— you would be able to precisely reach a specific audience with a specific post. Many customers will find you because they are looking for an accountant who understands their business and their issues.

Better Service — when you begin to specialize in a particular niche, you can learn how to adapt and satisfy the specific needs of your clients. Your accounting firm ultimately becomes a specialist in this niche, with advanced strategies targeted to these companies. This results in happy customers, generating a positive feedback loop with higher fees and higher retention rates.

Two kinds of Accounting Niches

  • Industry Niche
  • Transformation Niche

These are two key ways to expand an accounting firm by innovating with a niche in the accounting world.

An industry niche is unique to a particular industry. It simply means that your accounting firm specializes in assisting a business. It’s a particular form of company in which you have a good rapport. It could be dentists, hotels or even e-commerce companies— the possibilities are infinite.

A transformation niche is a particular field within the accounting world where you excel and can most effectively assist. For example, assisting companies in tax planning; it may even extend to financial counselling, asset management, exit preparation, forecasting etc.

If you just want to narrow things down, you should concentrate on both a business and a transition niche. Keep in mind that this does not exclude you from accepting clients or providing services outside of your transformation specialty. 

How to Select an Accounting Niche in Your Industry

If you want to concentrate on a particular field, the most challenging thing for any accounting firm is choosing which niche to focus on. There is too much to learn to become an expert advisor for every single business. A restaurant has different problems compared to a construction firm, and you don’t have enough time in the day to get into the complexities of both, let alone the hundreds of industry niches out there.

The crucial question to ask yourself as you decide when you want to start building an industry accounting niche is what you effectively deal with and what your knowledge and experience are.

It is likely that you already service a particular niche. All you need to do now is delve deeper into it and actively market to this field. Also, you need to take into account prior experiences you have. If you have previous experience in a certain sector, you would naturally be able to relate to these people better. Make a list of professions in which you feel at ease and sectors of which you have previous experience. 

How to Select Your Particular Transformation Accounting Niche

While we suggest that the company provide a wide variety of services to market and upsell customers, if you represent a general firm, you can benefit from concentrating on a particular transformation niche. Perhaps you already believe you are the best at tax planning, or you appreciate financial counselling but dislike tax preparation. Perhaps you already have a variety of CFO services or have experience in exit planning.

You should ask yourself what it is that you excel at and what areas you’d like to be better.

If you excel at a specific service, you can sell it to a wide range of industries. However, combining an industry-specific niche with a transformation niche allows you to hyper-target.

Nevertheless, the most important factor to consider when selecting either type of niche is whether it is lucrative or not.

Choosing a Profitable Accounting Niche in a Crisis

2020 was a tough year due to the pandemic and client cancellations are placing accountants under pressure as more companies slash prices.

Many people are frustrated because it is unclear which niches are lucrative, even within the same sector. It’s convenient to say that the travel industry is in turmoil and accountants should avoid it, but bear in mind that there are niches inside niches.

Food & Restaurant Accounting Niche

Businesses that concentrate on interaction including events, in-person services and retail have been heavily impacted in 2020, while businesses that focus on digital are witnessing skyrocketing growth. So, if you want to start a new accounting niche in 2021, choose a sector that is doing well or a booming company within an industry that is struggling overall.

How to Categorize Accounting Niches in 2021

  1.  Take into consideration the businesses that are not needed. The demand for their services has been decreased or eliminated as a result of the new economy and shifts in market and industrial behaviour. Examples are escape rooms, vacation rentals, gyms, craft breweries.
  2. Take into account the companies that were impacted. These businesses were affected by the crisis; but since their products and services are in high demand, they will possibly rebound though they will have a viable market going forward. Examples are doctors, dentists, chiropractors, etc.
  3. Consider the businesses that were not impacted. These companies essentially tended to act in the same manner as before the crisis. They were either not ordered to close and so they continued to operate, or they ran a digital enterprise. Examples are construction, online consultancy, etc.
  4. Consider COVID beneficiaries as well. These companies not only flourished, but thrived through the crisis, seeing growth in demand, sales, clients, and in some cases, profitability. Some encountered this as a consequence of their current sector; for example, delivery, cybersecurity, e-commerce, and so on, whilst others pivoted to service growing niches; for example, mask making, hand sanitizer, etc.

Rules of the 2021 Post-Crisis Accounting Niche

  1. Concentrate on businesses that are more technologically focused.
  2. Determine which of the categories your clients belong to
  3. Conduct a discovery call to better understand their situation.
  4. Determine what services to provide based on their situation.

The positive news is that we discovered that many accounting companies thrived by working on specific transformation niches. The most significant distinction in the coming years will be between advisory and enforcement. Advisory services assist the customers with making profits, while regulatory services are simply expenses.

This is why advisory services are projected to be an intense transformational accounting niche in 2021. For example, when the pandemic shut down the economy, we discovered that struggling companies that had been affected or were no longer needed were looking for legislative and lending advisory services for the PPP, EIDL, CARES act, and forecasting/budgeting to handle cash flow. Meanwhile, growing niches that were unaffected or benefited by the pandemic need higher-level advisory services such as tax planning and CFO.

Distressed Accounting Offerings

Bear in mind that there is still an opportunity for accounting companies to represent troubled offerings in 2021.

  • Forgiveness Consulting with PPP
  • Prediction
  • Management of Cash
  • Planning a budget
  • Tax Preparation
  • Interim 2 of CARES
  • COVID Bill, Phase 4 (Heroes or other)
  • Consultation on Bankruptcy
  • Consulting for Company Closing

How to Expand an Accounting Business by Specializing in Accounting Niche

Remember that accounting generalists who deal for others would have a more difficult time commanding higher fees. Selling is more difficult when what you’re selling is essentially a product. Accounting companies who sell to niches will specialize and bill for their knowledge.

Choosing Between a General Accountant and a Niche Accountant

Generalist Accountant: focuses more on you than the client. General accountants speak of themselves, how long they’ve been in business, how well they’ve done for their clients before trying to fit into your particular niche.

Niche Accountant:

focuses more on the clients as opposed to general accountants. They tell you the specific niche which they operate in including areas where they can help you grow. For example, they might specialize in the tax niche. So they might offer financial consultancy services for chiropractors who will assist you with all your tax and accounting needs in order to maximize your profits. They go on to explain how they tailor everything they do to chiropractors.

This is a significant difference between general accountants and niche accountants.

If you want to know how to grow an accounting practice, we recommend that you use our wealth management program. Our wealth management program will help you learn about essential resources and how to produce the best benefit, as well as, how to build a benefit and loss statement, inspire the workforce, and how to develop efficient processes. Discover new services designed for you and learn how to generate unrecognized value.

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