What are the best niches for accounting firms to specialize in?
As self-employed accountants and tax professionals, we often hear about the importance of picking a niche to specialize in.
We know that we need to position ourselves as experts at serving a particular type of client or providing a specific type of service, but picking a niche can be difficult.
It’s an important strategic decision that underlies everything we do in our accounting firms, from marketing to practice management to service delivery.
In this article, we’ll explore the benefits of specializing in a niche and go over the 10 best tax and accounting firm niches.
Why should your firm specialize in a niche?
Specializing in a niche provides you a variety of benefits.
It enables you to:
- Develop a crystal clear understanding of your ideal clients’ problems and pain points.
- Craft highly-relevant marketing messages that speak directly to your ideal clients.
- Create lead magnets that imprint you in your ideal clients’ minds by giving them massive and immediate value.
- Speak your prospects’ language during sales meetings so they’re comfortable interacting with you both in person and on the phone.
- Serve and advise your clients in a way that a generalist accountant wouldn’t be able to.
Take one more look at that list…
You’ll notice that niching gives you an advantage in two major areas. It allows you to acquire specialized skills so you can better serve your clients, and it allows you to increase the effectiveness of your marketing.
These two advantages will create a positive feedback loop that helps you get new high-paying clients with predictability.
By positioning yourself as an expert in their field, you will pique the curiosity of your ideal clients. They’ll wonder, what can you offer that their current generalist accountant cannot?
And as you gain more experience and establish a reputation by providing your clients with excellent service, you’ll become a credible expert who is well-respected within your industry.
The 10 Best Niches for Accounting and Tax Firms
You can take advantage of these benefits by specializing in any niche, but frankly, some niches are easier to work with than others.
Let’s go over the 10 best niches for accounting and bookkeeping firms, as well as what you need to do to ensure your success breaking into one.
Here’s a quick rundown of the top 10 accounting firm niches, in no particular order.
- Real Estate
- Tradesmen (plumbers, HVAC, electricians, etc.)
- Marketing Agencies
- Restaurants & Bars
- Veterinary Practices
- Engineering Firms
- Law Firms
Now let’s take a look at why each of these industry niches made the list and see if any of them stand out to you.
Real estate is a great industry niche. You could work with agents and brokers, or you could serve real estate investors who buy, sell, fix, flip, or wholesale properties.
Because real estate accounting and tax compliance is one of the most complicated areas of practice, knowing the ins and outs of specific regulations and strategies will make you priceless to your clients.
You’ll be able to charge premium fees for your services because your specialized knowledge brings more value to the client.
Construction is another great niche that requires specialized skills, thereby making you more valuable to your clients.
Job costing and budgeting are key tasks in construction, and an accountant who hones those skills will always be in high demand.
Another way to add value is to help your clients streamline processes by implementing the latest time-saving technology and apps. Being well-versed in these tools will help you advise your clients on how best to run their businesses.
You can save your construction clients a ton of time and money by offering these skill sets. For these reasons, positioning yourself as a construction specialist can be very lucrative.
Tradespersons (Plumbers, HVAC, Electricians, etc)
Like construction, trades have a lot of tracking to do: keeping track of expenses, invoices and billing for multiple small jobs, and tracking hours for several employees who are moving between job sites.
These are all areas where you can stand out and make your client’s life easier, and ultimately, that’s what people pay for.
Tradesmen are a tight-knit community, so it may be difficult to build trust initially. Of course, they don’t expect you to know all the technical aspects of what they do, but they do place a high value on professionals who take time to get to know them and understand what they are about.
The upside is, once you become an industry insider, you’ll be able to count on steady work from referrals.
Marketing agencies tend to be a bit more tech-friendly than most other industry niches.
They’re comfortable operating in the fast-paced digital world and are very familiar with utilizing online tools for communication and workflow. They also measure everything and understand the importance of tracking ROI.
If you love to use technology to streamline processes for your busy virtual clients, you can bring a lot of added value to a marketing agency. Show them how your services can help them make more money and save time, and you’ll have a client for life.
Restaurants & Bars
Another great niche is restaurants and bars. Again, costing and budgeting comes into play, but on a different scale from construction. If you enjoy managerial and cost accounting, you could help your clients stay in the black.
These clients can also quickly become a passion project. If you love coffee, are a big-time foodie, or have a passion for helping smaller family-owned operations, this can be a very rewarding field.
Remember that restaurants are often a passion project for the owners as well. They are doing what they love and it matters to them that their accountant cares too.
Specializing in working with self-employed chiropractors can also be highly lucrative.
Most chiros have small practices where they are directly involved in the day-to-day work. This is a great niche if you want to build a genuine relationship with your client and become a trusted advisor.
Insurance billing is another unique aspect of working with anyone in the medical field. Developing an in-depth understanding of how insurance works will put you above the competition for your potential clients’ business.
Another benefit of working with chiropractors is that it’s easy to figure out where they hang out both online and offline, so you know where to direct your marketing efforts.
This is another great niche for those who want to work with businesses they are passionate about and build personal relationships with the owners.
Vet practices are typically small businesses who are looking for a trusted advisor who can offer a range of services. They need someone who understands their businesses and can help them leverage their business’s profits into lasting wealth.
If you don’t offer everything your clients need, no problem. You can connect with other trusted professionals who can provide the solutions you’re looking for. This means that your client doesn’t have to juggle multiple service providers around their already busy schedule.
And there’s a bonus in this niche – puppies!
Engineering firms have very similar needs to construction firms. Like construction, they need budgeting and job costing and they also use specialized tools and software for tracking projects and allocating costs.
When working on major projects, engineering firms deal with special rules for recognizing revenue, based on the percentage of completion of the job.
Those that work on government contracts have an added layer of complexity. Being familiar with this process will give you a major advantage over all the competition.
Learn the tools of the industry and stay on top of relevant tax laws and updates, and you can help your clients be more profitable while working more efficiently. It’s a major win-win.
There’s a wide range of law firms you can focus on, from boutique practice with solo practitioners to medium-sized firms with dozens of attorneys. Both can be very worthwhile.
Given the world that lawyers operate in, discretion, trust, and professionalism are all valuable attributes that can make you a top choice.
You also need to be able to explain the reasoning behind your advice and assure them that each decision is not only financially beneficial but also in line with all laws and regulations. Remember, they speak law like you speak numbers.
This is also a very stable, recession-proof niche. Law firms don’t slow down with the market, so you’ll be working with a very steady industry.
Additionally, lawyers are often big networkers. That means that you can make connections and get referred to other prospects in your niche.
Accounting for non-profit organizations may be the most specialized work on this list.
Tracking donations and implementing a fund accounting system is very different from most for-profit work. Once again, knowing the software and tools that can help your client streamline workflows and save precious time will give you a huge advantage.
In addition to tools and apps, many nonprofits use industry-specific software, which allows for fund accounting and donor tracking. Being trained and certified in that software can make you stand out and give you an edge over the competition.
Maybe more than any other niche, not-for-profit clients allow you to do work that has personal meaning to you. You can niche down even further and specialize in nonprofits who serve a specific area of need that you’re especially passionate about.
Getting Started in Your Niche
Maybe you’re already practicing with a wide range of clients and want to niche down to something more focused.
Don’t feel as if you need to fire your current clients and start from scratch. This will be a gradual process.
Here are some things you can do to get started today. There’s no better time than right now!
- Once you choose your niche, start researching the industry to see what issues and pain points you need to focus on solving.
- Start conversations with people in the industry and see what they are looking for.
- Find out what software and tools they use and familiarize yourself with them.
- Add one new client at a time from your new niche and get more specialized as you grow and start to part ways with old clients who are no longer a good fit.
You’ll get better at serving your niche every day. Before you know it, you’ll be known as a specialist, and you’ll be getting paid like one too.