Mentor and Speaker for accountants BookMarkLee
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Are you a specialist or a generalist?

25th Apr 2016
iStcok_ImageDB_Jack of all trades

 

Mark Lee considers the pros and cons of accountants specialising rather than being a traditional general practitioner.

Four years ago I posed the question: Are you a bog-standard accountant? More recently I was asked whether accountants are more likely to build successful practices if they are generalists or specialists.

General practice

Most accountants start out as general practitioners and tend to stay that way as their client base has always been quite disparate. Many of those who specialise do so only because they originally trained in firms that had a specialism.

It is especially difficult for multi-partner firms to focus on a single specialism. What tends to happen is that different partners focus on different niches. Indeed this is another reason for there being so many general practices. Even if individual partners focus on a specific niche, the firm itself cannot claim to specialise.

Why focus?

There are several reasons why focusing on a niche makes it easier to make more profits.

The starting point is that it becomes easier to attract more clients. This is because it is easier for people to recognise when to recommend you. Having a clear focus also makes it easier to attract PR. In simple terms an accountant who has a clear and distinct niche will STAND OUT from the other accountants they and others might previously have seen as their competition.

When you try to be all things to all people you end up being the same as everyone else. Why should anyone recommend or refer clients to you as distinct from the accountant down the street? Why should anyone who meets you remember you as distinct from the other accountants they have met or might meet in the future?

Having a clear focus or niche also helps your ranking on search engines. The key point here is to rank highly for what prospective clients are searching for. Being number one for ‘Accountants in London’ is a tough ask. Being number one for ‘accountant for taxi drivers in London’ is easier. And easier still when referencing more specific areas than ‘London’.

 

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Replies (13)

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By johnjenkins
26th Apr 2016 09:38

I'm not sure

if I like this article or not. For me it has good points and bad points. None stand out. So my conclusion is that it's a waste of time (you won't know that until you've read it).

My practice is split between specialising in the construction industry and general, with a varied client base. They both work vey well. As your practice develops over the years there might be an unintended specialisation going on.

I really don't think that when a business is looking for an Accountant they will actually look for a specialist first off.

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Man of Kent
By Kent accountant
26th Apr 2016 09:41

Not sure?

I see myself as a generalist but maybe I am a specialist of sorts - who knows?

I have a relatively large number of construction industry clients from small subcontractors through to companies with several million pound turnovers. I do tend to attract 'more than my fair share' from this sector.

That's fine, I spent 12 years working for these types of businesses so maybe I could call it my 'niche'.

I also have quite a few recruitment consultancies that I act for.

These two sectors in isolation probably account for around 25% of my turnover.

Perhaps I could start marketing myself on this basis?

Would it make any difference? 

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By justsotax
26th Apr 2016 09:58

if i had a merc

and there was two garages down the road with comparable prices...one was 'general' and one was a merc specialist...I guess I would go to the merc garage all other things being equal....just may give the edge where you are marketing to specific group where you say you have specific expertise in that area.  But then some firms seem specialist in 'all' areas....

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By Vaughan Blake1
26th Apr 2016 10:07

One thing that these articles always ignore is...

Location.  The answer surely cannot be the same for a small town accountant and an identically sized accountant in a heaving metropolis.

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Mark Lee 2017
By Mark Lee
26th Apr 2016 11:27

Always?

Vaughan Blake1 wrote:

One thing these articles always ignore is.....Location.  The answer surely cannot be the same for a small town accountant and an identically sized accountant in a heaving metropolis.

I could equally say that 'One thing that comments always ignore is my willingness to accept that there is no single answer that applies to everyone/everywhere.'

I'm sorry you don't feel I spelled that out adequately in this article Vaughan. 

Mark

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By Vaughan Blake1
26th Apr 2016 12:08

Just curious, not criticising

I am just interested if it has been considered whether certain approaches will work better in Sticksville than Metropolis and vise versa.  I can't recall having ever seen the point raised before, and having worked in both, I was curious as to what others thought.

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By johnjenkins
26th Apr 2016 12:19

@Vaughan

A lot will depend on the type of people and business that reside in these areas. Market towns might have loads of farmers but they would still have builders, window cleaners etc. I'm not sure if location would make that much difference. It might be that an Accountant has moved to "out of town" for living purposes but sill keeping their "townie" clients.

So I come to the same conclusion. Overall I don't think there is much of a difference and I certainly don't think it matters.

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Mark Lee 2017
By Mark Lee
26th Apr 2016 12:35

I believe the principles will be the same regardless

Perhaps the biggest difference is that some towns are so small that there is no effective competition and so everyone goes to the local general practitioner. Well, that's what will have happened n the past. These days not everyone requires a local accountant.

Mark

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By Glenn Martin
26th Apr 2016 14:54

How do you decide your Niche

Do you pick something you enjoy or have an interest in, or do you go with something you have earlier experience of.

Everyone wants to deal with Dentists as the theory is they all have loads of cash so should be good clients, but everyone couldn't be a specialist in the field.

I was FD in companies in Leisure and Healthcare and although I feel I have specialist expertise in these fields, I have not cracked it to have only have these types of business as clients. The reason for this is that both industries tend to be dominated by larger players so whilst I have a few clients with single care homes and again a few independently owned bar/restaurants but I do not only have a book full of bars and restaurants.

Also from a chicken and egg point of view, If I researched/trained so I know dentists inside out does that make me a dentist specialist as surely you would need 20/30 on your books to claim this, and if you only look after one how do you attract others.

Also if say you signed up 1 taxi driver who later brings all his pals down from the rank are you then a taxi specialist or are you just someone who has a lot of taxi drivers as clients.

Also is Niche not also potentially high risk, as I imagine everytime there is a budget and IR35 is mentioned the contractor accountants are nervous as they have all eggs in one basket.

Same would go if you were a specialist in Steel Producers.

I could see if you worked for a Big 4 firm doing some specialist work, that if you left and set up a small niche practice that your clients followed you to it would work well.

For me however I maintain a 50% general client portfolio as they are safe, always there and the core of my firm that pays the bills which hopefully will create some value in the future when I exit the business in the future, the other half of my fees are around my VFO roles which pay well and I enjoy but are not really long term a lot of the time, and I don't know if they could be classed as a niche. 

I suppose by its nature niche cannot be for everyone.

 

 

 

 

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By rememberscarborough
26th Apr 2016 15:23

BTW There are other alternatives than going in to practice. I've spent over 25 years working for SMEs within the construction sector so am a bit of a specialist but I also spend my days dealing with all aspects of finance and non-finance.

I guess it comes down to what you enjoy so specialise if you enjoy a particular area or generalise if you want the variety. It's up to you...

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By nathan666
26th Apr 2016 16:43

View from a niche

As someone who works for a true niche practice - all our clients are one industry only from all over the country - healthcare related- we see firms trying to break the market all the time, it is not easy though and takes a lot of staying power. A lot of firms seem to make a big push then move on. In our market there are groups that have been formed by firms of accountants to define who is a specialist and so you will find it difficult to break the market- it will be a long slog rather than an instant impact. You need to be passionate about the sector as if you are just in it for the money you will have a long wait. If you are looking for easy wins this isn't it, unless you can be a lot cleverer than every other practice that has decided it is also a specialist....

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Hallerud at Easter
By DJKL
26th Apr 2016 17:53

Not all specialities are a good idea

Well, given the recent Any Answers post re allowable costs of costume/other etc for an "exotic "dancer there certainly appears to be a great deal of professional interest in that niche so might not remain a niche for long.

I am also not sure what the reaction would be from my other half if I redesigned my website focusing on this sector and spent my time distributing business cards around Edinburgh's pubic triangle. (Honest, it is a geographic area) 

A firm I used to work for had a fair few footballers/ ex footballers as one of the partners had been a professional player (a very good player) but we also seemed to have most of the Edinburgh taxi drivers as the same partner travelled a lot in taxis- this latter  category is not an area I would really recommend, I have none on my books and long may it stay that way.

 

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By Vaughan Blake1
27th Apr 2016 12:30

And that's the way it usually happens

DJKL wrote:

A firm I used to work for had a fair few footballers/ ex footballers as one of the partners had been a professional player (a very good player) but we also seemed to have most of the Edinburgh taxi drivers as the same partner travelled a lot in taxis- this latter  category is not an area I would really recommend, I have none on my books and long may it stay that way.

 

I don't think that it is possible to decide to specialise in an area, study for it and then launch the idea cold.  It depends on your personal interests, your net working group, your friendship group, which pub you frequent, luck and dare I say location.

 

 

 

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