When you own or operate a business, it’s always a good idea to play to your strengths. Not only does choosing a niche allow you to specialize in what you’re good at (or what you enjoy), but it also helps the right customers discover you at just the right time.
In an accounting practice, choosing a speciality provides a level of focus for the services you provide and the clients you attract. It comes down to knowing what you want to offer, how you can provide top-notch accounting or tax services, and how you can combine these strategies to grow over time.
One important element of this type of growth is choosing a niche for your accounting firm. In this post, we’ll cover what a niche is, why you should consider choosing one, and which ones have the greatest competitive advantage.
What is an Accounting Niche?
A niche is a single area of focus that allows accounting and tax professionals to offer a product or service to a particular segment of the market. An accounting niche can involve one of two things:
- Offering accounting services exclusively to another industry or type of business
- Providing a specific financial service or method of accounting to potential customers and current clients
A niche market allows the provider to hone in on clients who are in need of very specific services. This means accepting or working with clients who fit a certain set of criteria and have alignment with the business as a whole.
At first, choosing a niche might sound limiting. But in reality, accountants and tax professionals who operate a successful practice within a given niche find extra freedom, flexibility, and growth in their speciality.
What is General Practice Accounting?
In some ways, general practice accounting is the opposite of niche accounting. In general accounting services, accountants and tax professionals offer a wide variety of services to any client or customer, regardless of need or industry.
A general accounting firm might offer skills like:
- Financial statement preparation
- Ledger management
- Cost accounting
- Wealth management
- Bookkeeping services
- Bill pay and payroll
- General business management
- Tax document preparation
To be a general practice accountant, you still need the same training and qualifications. Most importantly–general practice providers are equally skilled at performing job duties. It’s a matter of the scope and speciality of the services provided.
Qualities to Look for When Choosing Your Niche
Before you decide which niche is best for your professional interests and qualifications, you should take a look at as much data and market research as possible. This background information helps you make a wise decision for business growth that aligns with your personal and professional passions.
Some qualities to watch for in the accounting or tax niche of your choosing include:
- Long-term viability – Is your niche one that will still be essential several years from now, or are you meeting a short-term, current need?
- Profitability – If you’re looking to increase sales and revenue, how does your chosen niche compare to others? If your main goal is profitability, would any other specialities help you reach that destination sooner?
- Local customer base – Depending on how you run your business (online or in-person), do you have the clients you need to thrive in a successful operation? Is there enough interest to justify your specific choice?
Viewing these characteristics in tandem can help you make the most informed decision possible.
5 Fast Growing Accounting Niches and Specialities
In today’s economy, knowing which niche markets are growing at a quick pace can help you make the right decision. If you’re an accountant or tax professional and you want to offer services to a select industry, here are a few that hold promise.
SaaS and Software
SaaS (Software as a Service) and other software startups are constantly growing and evolving. This industry needs solid financial know-how to manage startup costs, funding, rapid growth, hiring sprees, and more. Accountants and tax professionals who are seeking a fast-paced environment can opt for the SaaS route.
As a result of the COVID-19 pandemic, medical providers and healthcare systems have a tangible need for reliable accounting assistance. Growing investments, modernization, and mobilization have contributed to the sharp increase in financial needs for medical providers.
As an accounting expert, you can facilitate major activities for medical providers and offices, including:
- Management and reduction of overhead costs
- Active sales of practices and healthcare systems
- Practice-to-practice negotiation
- Direct financial services to physicians and healthcare professionals (who may be eligible for specific insurance, benefits, and more)
Real estate is another industry experiencing exponential growth, particularly in light of the current housing market, interest rates, and high consumer demand. Although this market ebbs and flows over time, its longevity is well-tested.
Accountants can provide knowledgeable and skilled advice to buyers, sellers, and real estate or mortgage agents. There are also numerous opportunities to get involved in federal, state, and local tax preparation for real estate needs.
Accountants who specialize in this industry will likely grow in their knowledge of multiple fields (financial and real estate) and be able to provide comprehensive services to clients.
Ecommerce is focused on the sale of goods and physical products in online environments or digital stores. With the rise of online shopping and digital retail management, eCommerce continues to be a growing force in the way that customers shop.
Accountants who specialize in this particular niche may choose to focus on offerings like digital bookkeeping and virtual financial services. Since many eCommerce providers work entirely online, this accounting niche is designed for the digital entrepreneur who can work flexibly and offer an accommodating experience.
Food and Restaurant
The food, restaurant, and service industries continue to face major changes in relation to a global pandemic, inflation, and supply shortages. Good financial skills are needed now, more than ever, particularly as food service providers look to stay in business.
Accountants and tax professionals can choose this niche to support small businesses, eliminate or reduce extra operational costs, and provide long-term financial planning in the midst of economic downturns.
The Benefits of “Going Niche”
As an accountant or tax expert, you may have questions about what’s in it for you (and the future of your business) when choosing a niche. This is an important question, but it’s reassuring to know that there are several advantages when selecting a single slice of the market. These benefits include the ability to:
- Work within your expertise – Choosing a niche allows you to spend even more time on a speciality area in which you excel, with a client base that needs your specific service. This provides more time to fine-tune your expertise and become an industry leader in a given field.
- Command higher fees as an industry leader – As an industry leader, there are certain perks. One benefit is that you can charge a higher rate for your services. When you become an expert in your niche, you’re more likely to be in high demand with new prospects, which means that you have the option to charge a premium.
- Provide better service to clients – When you perform work that you love and are good at, you end up providing an enhanced experience to your customers and clients. This often happens organically, simply because you’ve made the right choice.
Mistakes to Avoid When Choosing a Niche
Even though a tax and accounting services niche provides room to grow, it’s not always easy to pick and choose. Here are a few mistakes to avoid when picking a speciality accounting area for your business.
- Choosing a highly competitive niche “just because” – When you think about trends, make sure to balance what’s popular with what is best supported by data. Many accounting firms that go for trendy niche today could be out of luck once it's past its prime in a few years.
- Picking a niche without room to grow – A speciality should provide enough opportunity to grow your business and to enhance your professional skill set. Try to avoid a subfield that puts you in a set box without future opportunities.
- Not using data to identify a need – Market research speaks volumes when it comes to choosing the niche that’s best for your business goals. Take a close look at the current market, the demand in your area, and the results of competitors. This information provides key clues about how a specific niche might perform over time.
Skyrocket Your Growth in Any Niche
As a tax or accounting professional, you now have a better understanding of what it means to choose a niche and why it’s important for your business. With this grand work in place, you can accelerate your growth through better marketing, impressive client acquisition, and better resource management.
That’s where CountingWorks PRO comes in. Our platform is trusted by over 8,000 accounting professionals who are eager to simplify their business processes in order to create a sustainable, growing business model. Regardless of your niche, CountingWorks PRO will help you realize the limitless potential of your business.
Interested in learning more? Set up a free demo with our experts.