From the Aug. 2012 Issue.
It seems like every conference I attend, I hear someone talking about the niche business model. It’s the hot topic these days, and for good reason. Firms that have adopted this model are enjoying standardized processes, higher revenues, and operating at peak efficiency. Of course, the niche model certainly isn’t a new concept, but for some reason it has taken longer to emerge in the accounting profession. However, despite a late arrival, the niche business model is infiltrating the profession. And trust me…it’s here to stay.
I am an outspoken advocate of the niche model because it’s one that I implemented in my own firm with great success. Years ago I decided that I needed to “define” my firm; that is, figure out what services I was good at providing and the type of clients I wanted to serve. Like many other firms, I held on to a “take-any-client-that-comes-through-the-door” mentality. Because I lived in constant fear of losing clients, I worked to consistently onboard new clients…no matter the industry or service level. The only thing I accomplished by doing this was working long hours trying to please a diverse client base with vastly different needs.
Eventually, I figured out that by not having a defined business model, it was my clients who defined my firm’s workflow processes. Because I was trying to serve so many different types of clients, I was unable to standardize any process. The end result was a lot of chaos and wasted billable hours. So, I took a step back from the anarchy, conducted an honest evaluation of my firm, and started to define what I wanted my firm to look like.
I knew that if I was to regain control of my firm and lead my clients instead of my clients leading me, I needed to simplify things. That’s when I adopted the niche business model. By serving only select niche markets, I was as able to gain expertise in a few industries, master the accounting needs of each, and implement uniform processes for serving each niche. Over time, my firm transitioned from a state of disorder into a highly efficient operation. Most importantly, by defining my client base, I got to select the clients I wanted to serve and enjoyed working with. And it’s a really great feeling to go into work when you enjoy the clients you serve!
The accounting profession may be a bit slow to adopt new concepts, but we certainly know a good thing when we see it. And the niche business model is a keeper—offering firms the power to define their business and their clientele. For those who have yet to research this model, I’m here to confirm that it is indeed a niche world.