Niche development tips: CPAs with strong service specialties share some details about how to make them grow.
* CPAs WITH DIVERSE EXPERTISE tell J of A readers what niche development techniques or processes helped them accumulate clients in a certain category. To learn about the automotive industry, for example, one firm attended automotive conferences, took dealership classes and interviewed car dealers.
* TO BUILD A FORENSIC ACCOUNTING, family law consulting practice, one firm identified others providing those services in its local markets. To position the firm competitively, it gathered information about their partners' expertise and their approach to marketing.
* BECAUSE AN INFORMATION TECHNOLOGY niche requires a big investment, a firm should be very exact about what it wants the IT practice to do for the organization.
* IN LITIGATION CONSULTING be aware that opposing lawyers will look at your Web site prior to taking a deposition. Be sure your information is accurate and that you can respond to questions about it.
* IN MANUFACTURING THE PUSH TO GLOBALIZE means U.S. CPAs will have to help clients with international tax issues and finding overseas providers for some accounting and financial reporting needs.
* TO START A REAL ESTATE NICHE, a CPA firm should talk to key real estate developers and brokers in its market and find out what organizations they belong to and what service(s) they would like their CPA to provide. One CPA who became a licensed real estate broker let clients know he was doing it to provide them with better service.
The gamut of business enterprise is almost as large and varied as humanity itself, and many of those myriad companies require CPA help with taxes or bookkeeping (or getting a loan or defending against a lawsuit or planning for succession or increasing their organizations' scope, efficiency and marketability in any number of ways). Through design or, sometimes, serendipity, many practitioners acquire strengths (that is, significant experience, depth of knowledge and engagement volume) in serving one or more specialized types of businesses. We asked CPAs with diverse expertise to tell J of A readers what techniques or processes helped them go from having one or two clients in a certain category to many. Their niche development tips are the cornerstone of this roundup.
In addition, the AICPA offers concentrated development support in a number of business areas, including designations such as the ABV (see "The ABV Credential: Leading the Way," page 41), CITP and PFS (see "It Works for Them," J of A, Jan.03, page 63 and "Managing Client Assets," J of A, Jan.98, page 33). For information on obtaining specialty credentials within the accounting profession and for consulting standards guidance, see "AICPA Resources," page 48.
Antonio L. Argiz, CPA, is managing partner of Morrison, Brown, Argiz & Co. LLP, a Miami firm with a robust car dealership niche. The firm also has service strengths in the financial institution, technology consulting and litigation support areas. The 12-partner, 64-CPA, 140-person accounting and management consulting firm began in 1969, and Argiz--who heads the automotive sector--joined it in 1977. This is what he has to say about car-dealership work:
Getting started: The best resource to grow any business is human capital (smart, hardworking staff), and there's no shortcut to success that I know of. One way to tap into the retail automotive industry is to hire former dealership controllers.
When our firm first began providing accounting and auditing services to a handful of auto retail clients in 1972, we decided to learn the industry thoroughly. We attended automotive conferences, took classes and talked to professionals from all corners of the business. Our dealership client list is now more than 100. (For more information on serving the automotive industry, see "Kick the Tires of a New Niche," J of A, Sep.02, page 28.)
Marketing: Attendance at business and social events increases our visibility. To get to know auto dealers, our firm offers seminars and participates in industry meetings. We put our name in front of CFOs by mailing industry alerts and informational memos several times a year, and we send a quarterly newsletter, Driving Profits.
Best thing we did: Business leads generated through satisfied clients are the easiest deals to close. Word-of-mouth marketing has helped open many doors. The best thing we've done is to consistently give clients good service.
Worst thing we did: We didn't plan our growth. Our dealership division could have developed more quickly if we'd focused on bringing in and training staff. Not having enough manpower at times has been limiting.
Best aspect of the niche: Auto dealerships offer great potential for cross-selling services. Dealer clients frequently need business valuation, fraud prevention, information technology and operations consulting.
Worst thing about the niche: The automotive industry has undergone extreme change in the past five to ten years, mainly due to consolidation and how car buyers use the Internet to shop. CPA firms have to invest continuously in acquiring the expertise to stay ahead of the competition. Understanding the evolving role of technology is the key to meeting dealership operations' needs.
The budget (for the overall practice): Salary, 62%; marketing, 6%; and overhead, 32%.
How the practice will change in the near future: Consolidation has caused the number of U.S. dealerships to decline. In some cases single-point dealerships (those with only one location) are closing their doors, and many multipoint car dealers have been bought by larger businesses and are now subsidiaries. The automotive niche includes subsegments such as new-car and used-car dealerships. Understanding their differences can help the firm successfully market to them.
Dealership owners (who often are the general managers, too) make most of the purchasing decisions in their organizations. Their controllers and CFOs influence them when it comes to contracting for professional services, however. General managers frequently are the initiators--the people who identify a need and make recommendations based on internal observations. For example, they might spot low productivity from their service department, high interest due to low-vehicle turnover or suspected employee theft--all areas where CPA controls knowledge can help the business. General managers or controllers directly use and evaluate what accountants bring to the table.
Tony Argiz can be reached at email@example.com.
FORENSIC ACCOUNTING/FAMILY LAW
Donald A. Glenn, CPA/ABV, CVA, CFE, founded Glenn & Dawson LLP in 1975. He and partner Leslie Dawson, CPA/ABV, CVA, say the seven-person, Walnut Creek, California, firm's hottest niches are forensic accounting and investigations, family law (including related business valuation) and civil litigation support. The partners use accounting, auditing and investigative skills to uncover the financial facts of a situation and, when necessary, give expert testimony. Here's what they say has helped build their business:
Getting started: Few others in our region provide family-law CPA services and investigations (examining financial records to determine their accuracy for litigation purposes), so our best referrals resource is association with skilled attorneys. For guidance we suggest locating a referring attorney to act as a mentor (don't be afraid to ask). To get business, ask experienced CPAs to recommend you when they are unable to take an assignment.
Marketing: Activities we've used or recommend include
* Providing pro bono services for family law courts.
* Advertising in local county bar association newsletters and magazines.
* Teaching litigation support and family law topics to state societies and professional organizations.
* Joining the local bar association and attending section meetings for family law, probate and bankruptcy.
* Speaking to bar associations and attorney groups--sample subjects include business dissolutions, fraud awareness and detection and divorce.
* Giving an annual seminar on litigation topics for referring attorneys and judges.
* Serving as an officer of a professional organization. (This sits well with attorneys when they assess your standing in the professional community.)
* Finding out which CPA firms in your local market provide litigation services, and gathering information about their partners' expertise and their approach to marketing. Use what you learn by emulating something you admire or positioning your firm competitively.
* Sending a letter and brochure to judges ha your area saying you're available to serve as the court's expert (do this only after you have qualified in court and testified as an expert).
* Calling attorneys who engaged you after cases are concluded to get feedback on how you might serve them better.
* Sending a personal thank-you note to a referral source--always.
Best thing we did: We always looked at the attorneys on the other side of a case as a future referral source. We made it a point to be nice to them--and if we won, not to gloat. We did not overstate our credentials or promise levels of service we could not deliver.
Worst thing we did: We didn't control collections for litigation services. Fees are high, and once a case is over and we're no longer needed, clients don't always see the value. (Now we get an ample retainer and our engagement letter provides for a schedule of payments.)
Best aspect of the niche: It's engrossing, challenging and an unending source of novelty. It requires us to continually update and improve our skills and, particularly in investigations, involves areas far afield from traditional accounting services. It keeps us sharp.
The budget (for the overall practice): Salary, 26%; marketing, 1%; overhead, 33%; and other, 40%.
How the practice will change in the near future: In our area, recent partner retirements at competing firms may divert more business to us, while new firms entering this market tend to target smaller cases. We think growth for firms well-established in the niche will be excellent.
Donald Glenn and Leslie Dawson can be reached at info@ForensicCPA.com.
Carol Mayo Cochran, CPA, PFS, CEBS, CMA, is a principal of REDW Business and Financial Resources, LLC, an Albuquerque, New Mexico, CPA firm in existence since 1953. Tina MacGregor is the director of technology for REDW Technologies, the firm's IT niche, started in 1998. Cochran and MacGregor collaborate on business development for the sector. The firm has 107 staff members (35 of them CPAs), and the IT group employs five network specialists and three business software specialists.
REDW's IT clients include banks and financial institutions, law firms, medical practices, Indian tribes, not-for-profits, casinos, health-care-service providers and closely held businesses. The niche provides services that include business software consulting on MAS 90, MIP and ABRA human resources and payroll solutions; network security consulting and security compliance; outsourced network administration and support; customized database design and implementation; and customized application training, conducted either in a classroom setting or on-site.
Here's what they have to say about offering IT services within a CPA firm:
Getting started: An accounting firm needs to be clear about what it wants an IT niche to do for it, and it must be willing to invest the necessary time and money to train people. Begin by finding out what services other CPA firms offer. Then define the goals and mission of your services. Next, designate a leader and agree on a business plan. Establish software and other technology vendor relationships for the services and solutions you intend to offer clients. (For more information on executing a firmwide undertaking, see "Strategic Planners Lead the Pack," J of A, Dec.01, page 26.) Vendors will train and certify your staff and offer planning guidance, marketing and sales support to your firm. Our practice uses Best Software solutions and Microsoft technologies for our network integration service.
Marketing: Look among your firm's existing clients to find your first IT customers. Many have technology needs that show up during traditional engagements. Select targets from the firm's client list and ask the principal for a referral or an introduction. Always keep the referring partner "in the loop" when you follow up.
Besides cross-selling, we use a mix of marketing approaches, from yellow pages advertising to promotion programs that include networking at professional events, offering lunch-and-learn sessions for potential and existing clients and participating in technology user-group meetings and other target-market conferences and seminars. Find out what associations represent businesses you'd like to reach and ask for an invitation to their meetings and conferences. Mailings can be useful if you choose subjects pertinent to the client audience--network security for financial institutions, for example.
We get hits (and new clients) from our Web site (www. redwtech.com), which displays our technology services in three groups--network services and IT consulting; business and accounting software; and custom training.
Best thing we did: We got help from Convergence-Coaching LLC, an organization that specializes in helping CPA and IT firm clients make their practices more successful. We now focus on offering clients solutions that are "an inch wide and a mile deep"--that is, targeted and thorough. When we stopped trying to be all technology things to all people, business improved.
Worst thing we did: In an effort to be responsive, our team took on every IT client regardless of its size, needs or quality. We overextended ourselves, which diluted our focus, tired us out and hindered our overall success.
Best aspect of the niche: We get to make a positive difference in our clients' lives. Our brand and firm culture are based on keeping our word, holding ourselves to the highest ethical standards and fulfilling our commitments. We care about our clients, and our mission is to help them achieve financial success.
Worst things about the niche: Having to say "no" to clients when their needs are outside our chosen focus, and cold calls, which do not work well in the IT business.
The budget: For the overall practice--salary, 59%; marketing, 3%; overhead, 35%; and other, 3%; for the IT niche--salary, 53%; marketing, 5%; overhead, 35%; and other, 7%.
How the practice will change in the near future: Our goal is to grow 20% in the year ahead, and we think we will gain momentum from concentrating on areas that are a good fit with a CPA firm. We're committed to helping our clients identify cost-effective IT solutions and putting them in control of their technology. As their businesses succeed, so will ours.
Tina MacGregor and Carol Mayo Cochran can be reached at firstname.lastname@example.org and email@example.com, respectively.
Ann E. Wilson, CPA, has been in public accounting since 1980 and on her own since 1993. She often works with strategic alliance partner Paul Scott, CPA/ABV, in practice since 1978 and president of CFO's Advantage Inc. since 1988. They are sole practitioners who specialize in support services for commercial litigation including shareholder/partnership disputes, intellectual property litigation, personal injury claims and employment law disputes. They share a Solaria Beach, California, office and have independent offices elsewhere. Their firms keep costs down by outsourcing--to each other and to qualified CPAs and professionals in nearby San Diego. This is what they say will help build a litigation support niche:
Getting started: In the litigation consulting business, referrals are key. The lawyers you already know will be your best sources. Find ways to meet others, talk to them and convey your commitment.
Marketing: Networking and relationships are enormously important, they say. Over the years Scott has developed a core group of about 15 "advocates" (professionals who like him and refer work to him); he nurtures those relationships and contacts them once a month on a nonbusiness basis. Wilson says the best thing a CPA can do is be responsive to client-lawyer needs. She returns calls promptly, for example (a simple thing few expert-witness consultants do apparently, Wilson says, since many lawyers express surprise about it).
Both have Web sites (www.aewilsoncpa.com and www.paulscottcpa.com). Wilson's summarizes sortie cases she has worked on, so lawyers can easily find out more about her practice. (However, she cautions, remember that opposing lawyers also look at your Web site prior to taking a deposition, so be sure your site information is accurate and that you can respond to questions about it.)
Here are other marketing strategies they've used or recommend:
* Advertising with the Los Angeles County Bar Association as an expert or consultant, both in the Southern California Directory of Experts and Consultants and on www.expert4law. org, has been successful and cost-effective.
* Attending continuing education programs for lawyers rather than for CPAs. It's an excellent way to network, meet attorneys, learn more about what they do and what concerns them, and it shows commitment by the CPA to the litigation practice area.
* Developing one or two Power Point presentations about how to work with experts, or another topic of interest to lawyers, will let you be ready if an opportunity to speak comes up.
* Offering to do "brown-bag lunch" talks to law firms; many regularly schedule such talks and offer continuing education credit to their lawyers for this. They always are looking for speakers, and it's a good way to let them know what your areas of expertise are.
* Asking the lawyer you worked with for referrals after a successful engagement.
Best thing they did: Wilson: For the first eight years of my practice, I sublet office space from law firms. Those law firms also sublet space to other lawyers. It was a great way to get to know lawyers, tell them what I do and generate business. I also asked the ones I saw every day to introduce me to lawyers from other firms. Scott: I got to know many of the litigation support CPAs in my state and started working cases with the best and most experienced of them. (Note: Probably the highest compliment you'll get is when an attorney you've opposed on past cases hires you for his or her side on the next one.)
Worst thing they did: They took a few clients that either failed to pay all they owed or who paid extremely slowly. Payment terms are now covered in their engagement letters.
Best aspect of the niche: There's never a dull moment, and they get to work with some very intelligent people, both say. The litigation process is extremely varied and interesting--"like solving a huge puzzle"--and testifying in court is a real adrenaline rush, says Wilson: "You really have to be on your toes."
Worst things about the niche: Trying to schedule time. Pretrial and trial schedules change constantly, and there's no such thing as a predictable busy season in this business. You don't know whether you'll suddenly be extremely busy or find yourself sitting there with not much to do--which sometimes happens when a big case settles unexpectedly. "Over the years I've had to cancel many vacations and personal plans because of changed trial schedules," says Wilson.
Caveat: Many lawyers complain that testifying experts don't learn the details of a case and can make fools of themselves on the witness stand if opposing counsel is effective at cross-examination. The CPA who will testify must know the case cold. He or she should thoroughly check all underlying staff work while there is sufficient time for follow-up and should know his or her part of the case better than the hiring attorney.
The budget: Scott: Salary, 50%; marketing, 35%; overhead, 15%. Wilson: Figures not available.
How the practice will change in the near future: As cases get more complicated and more technical--especially in the intellectual property area--judges feel they need help resolving issues about which they are not particularly knowledgeable. CPA litigation consultants have been doing more work as special masters (accounting referees, that is). In this type of engagement, the CPA helps the court or an arbitrator make a decision, usually based on evidence and expert testimony presented by both sides. To get more of this work, Scott and Wilson attend the quarterly meetings and yearly conferences sponsored by the Association of Business Trial Lawyers (ABTL), a California organization with chapters in about six cities. "Many judges and high-level litigators attend these events, and it's a good place to speak with them to explain the kinds of cases I'm looking for," Wilson says.
Ann Wilson can be reached at firstname.lastname@example.org; Paul Scott can be reached at email@example.com.
BKD is a Springfield, Missouri-based firm with about 1,500 staff members (nearly 200 of whom are firm partners) and big-firm resources. It is the result of a 2001 merger of Olive LLP and Baird Kurtz & Dobson, both old-generation CPA firms with histories dating back to the early 1900s. BKD's manufacturing niche, a product of premerger Olive LLP, was developed by partner David P. Schmitt, CPA. Olive took a hard look at its regional market during the competitively charged late '80s and identified several niche areas that looked promising. Today, BKD focuses on four: manufacturing and distribution, health care, financial restitutions, and not for-profit and government. Here's what Schmitt has to say about building a manufacturing niche:
Getting started: To develop any specialty, a firm first has to get answers to two questions:
* What kinds of clients do we predominantly have?
* What is the market for these services in our geographic area?
Then it has to adjust its market goals to its resources. Large firms can focus on manufacturing as a whole, but small firms may need to concentrate on specific businesses such as plastics manufacturers, software developers and automobile or aircraft subcontractors, for example.
Once the firm chooses a business sector to develop, it needs to select a champion for it. Take that person out of the daily grind and give him or her one focus--build this practice. Establish benchmarks to measure progress and a time frame for reaching goals. The hard part is getting partners to invest (that is, accept less income and the possibility of failure) over the period of time it takes to get the niche going. Remind them that successful businesses put profits back into the enterprise.
Marketing: BKD's manufacturing and distribution group has full-time sales and marketing professionals, quarterly newsletters, educational seminars and the benefit of a good client referral base. It advertises in industry association publications and sponsors events related to the niche.
Best thing we did: We made the commitment to specialize. Some of our partners and managers had to give up clients from one sector to focus on another. They took a leap of faith, but the result is our firm now has the ability to speak the clients' language, understand the nuances of their businesses, operations and processes.
Worst thins we did: For a while, we became too specialized and overlooked normal industry peaks and valleys. That left some of our staff underused part of the year. For example, manufacturers typically have their yearends in September, October, November or December. That means a huge influx of work during the fall and winter months, but come summer, team members may wind up sitting around without enough to do. There are two ways to combat that: Identify consulting services that CPAs can work on in the off season and/or focus on a complementary industry such as not-for-profits, for example. That way, younger staff members can build experience in both areas, stay fully utilized and have the option to specialize on one thing later in their careers.
Best aspect of the niche: Industry is experiencing enormous change, and it's an exciting time to work with manufacturers and distributors. The best aspect of thoroughly understanding their needs is that we can give them service that helps their businesses run better. I get a lot of satisfaction from that.
Worst things about the niche: The hardest part is staying true to the niche and not being distracted by projects in other industries. It's tough to hand prospects off to others in the firm. And the bar keeps rising: Manufacturers forced to reduce prices have to increase quality and production levels at the same time. They put these same pressures on us. They now expect specialized services such as technology solutions along with tax expertise and insight into their business operations.
How the practice will change in the near future: It's tough to predict. Manufacturers are under continuous pressure to reduce labor costs yet find better ways to make and distribute their output. The current push to globalize means clients will need help with international tax issues and finding overseas providers for outsourcing some accounting and financial reporting needs. Industry trends indicate the United States will be the point of final assembly and distribution for many goods. That means engineering and customer service functions will continue to he based here for most manufacturers. Those businesses will need systems that can integrate clients' operations, including front- and back-office processes at overseas plants. One result is client interest in ERP (enterprise resource planning) systems.
BKD offers clients ERP support with Microsoft Business Solutions' Axapta software, which integrates all organizational functions and can track the progress of an order from engineering, production, assembly and distribution processes to the point of delivery. BKD's champion for the Axapta practice is Jeff Balyeat. ERP reformation technology is expensive to offer clients, but we think it is an important part of keeping U.S. manufacturing competitive. We now have more than 43 installations in the United States and other countries.
David P. Schmitt can be reached at DSchmitt@bkd.com.
John F. Heveron Jr., CPA, is president of Heveron & Heveron, CPAs, PC, a 12-person Rochester, New York, firm in existence since 1972. It offers its more than 100 nonprofit clients services that include traditional audits, reviews and preparation of annual filings for the IRS and New York state; special-purpose reports such as OMB A-133 single audits, audits of consolidated fiscal reports and retirement plan audits; reviews of organizations' internal controls and information technology security and efficiency; advisory services for choosing and implementing accounting systems and designing financial reports; help with preparing budgets and cash flow forecasts; and assistance with federal, New York and other state registrations including sales tax exemption forms. Here's what he has to say about serving nonprofits:
Getting started: To see what nonprofits are based in your region, consult a state association nonprofits directory. Our Web site www.nonprofithomepage.org lists state organizations and has links to many state agencies.
Before starting this business in 1972, I did nonprofit work at a big firm, where I learned how a nonprofit is formed, how to read their financial statements and tax returns, and about some of their special compliance issues and characteristics, such as a need for venture partners in the form of grantors. When a continuing education instructor for the Foundation for Accounting Education became ill, I filled in as a discussion leader for the program. Subsequently I updated the course material and continued teaching. Those programs were marketed to nonprofit financial executives as well as to the profession, and they gave us visibility and credibility.
Marketing: To get your name known, offer to speak at nonprofit organizations' meetings or luncheons. Our advertising mainly consists of writing newsletters, public speaking and organizing seminars, which bring us referrals. We're members of the nonprofit advisory council of the Professional Development Institute (PDI) and we write the Profitable Solutions for Nonprofits newsletter for PDI.
Writing a newsletter got us on the "bid list" for nonprofit audits, and that experience ultimately led to service on a United Way committee, which increased marketplace awareness of ore skills. As we grew our nonprofit client list, from a few to about 100, we accumulated more experience to offer with each proposal for services. We also have written training materials for the Foundation for Accounting Education and developed local college program, which were well-publicized and got our name blown regardless of how many people attended.
Best thing we did: We provided excellent service, which involved minimizing disruption to clients by scheduling meetings and information requests early, preparing thoroughly and soliciting only pertinent information. We want the best for our clients. We help them secure their assets, determine areas where they can be more efficient and identify valuable business opportunities.
Worst thing we did: Bought a series of ads in a local newspaper (not our audience). Now we do more research.
Best aspect of the niche: Nonprofit services keep us busy throughout the year.
Worst thing about the niche: Fees are lower than for commercial audit clients.
The budget: This is how we apportion the marketing budget: personal service, 75% (including newsletter writing, professional education program development and presentation, United Way involvement, client seminar involvement); and newsletter and other communications materials, 25%.
How the practice will change in the near future: We're not sure, but we plan to keep abreast of changes through the Independent Sector, a group that monitors legislation affecting not-for-profit organizations, and with daily e-mail updates on IRS activities. We also belong to INPACT Americas, a nonprofit CPA association for exchanging timely practice management and development information through a program of meetings and e-conferences.
John F. Heveron Jr. can be reached at John@heveroncpa.com.
Keith B. Spritz, CPA, JD, is a partner of Virchow Krause & Co. LLP, based in Appleton, Wisconsin. The firm, in existence since 1931, employs 801 people (which includes 116 partners and 332 CPAs). Spritz, who has 23 years of experience as a tax professional, has spent the past 10 years developing a real estate niche, for which he trained by becoming a broker. These are his suggestions for developing the niche:
Getting started: Real estate businesses have needs that vary from traditional accounting and tax services to due diligence for acquisitions and financings, for example. To find out what key real estate developers and brokers in your market need, call them and ask whether you can spend an hour with them to introduce yourself and discuss the services you provide. Sweeten the overture by telling them you may be able to share tax or financial strategies without being "on the clock." When you meet them, ask probing questions about their business, such as what projects they have completed, what projects they have under way and where they see the real estate market going in the next few years. Ask them what service(s) they would like their CPA to provide, and what professional organizations they belong to. Next, contact those organizations and volunteer to speak on a topic of interest. I chose to talk about like-kind exchanges, and to this day, they keep calling me back. I give four or five presentations a year on the subject.
Leadership and staff commitment are important to developing a real estate niche, too. The firm should choose a leader knowledgeable about the industry who can gauge where it is heading and direct the practice along those lines. Staff members choosing to specialize should focus their efforts on continuing education and developing marketing skills.
Marketing: Many large real estate brokerages have monthly in-house technical sessions, which offer a good opportunity to volunteer to speak on a subject of interest. Such meetings provide exposure to many individual agents who may be in a position to refer clients to you.
Get involved in local business organizations and become an active member in industry trade groups. For example, the National Homebuilders Association can provide a list of local chapters. The organization is always looking for affiliate members and is a good source for referrals. Next, contact the local apartment owners or rental owners association in your area. Volunteer your skills as a speaker. Advertise in trade publications and business-to-business print media.
Best thing we did: Whenever possible, we let our employees choose the industry areas in which they like to work and excel.
Worst thing we did: We were slow about developing niches and matching up clients and prospects with niche managers with specific expertise. At first it was difficult to convince others in the firm that the future is in niche specialization and not as a generalist.
Best aspect of the niche: As CPAs we really get to know our clients' business. We bring a lot to the table to help the market segments we serve succeed.
Worst thing about the niche: There isn't anything bad.
The budget: Our numbers aren't for publication. Partners have to commit ample resources to developing a niche and investing in staff education.
How the practice will change in the near future: Over the next few years, many more firms likely will develop specialties, and some will narrow their services to one or two, becoming boutique firms. CPAs will need to be actively involved in learning about an industry. To improve technical skills in the real estate area, for example, CPAs and staff can take advantage of self-study research and formal course work available through state societies, the AICPA, local bar associations and other professional organizations. To gain a better understanding of the business, I took the course work and sat for the exams to obtain my real estate broker's license. I let my clients and referral sources know I was doing this to get better at serving them, not to take work away from them.
Keith B. Spritz can be reached at firstname.lastname@example.org.
The Institute offers a range of niche-consulting practice development resources, including many that support its ABV, CITP and PFS credentials. Go to www.cpa2biz.com, and type in ABV, CITP or PFS, or type in consulting and a specialty you're interested in. Order items and register for conferences through CPA2Biz at 1-888-777-7077 or online at www.cpa2biz.com.
Check the 2004 schedule for conference elates in your areas of interest. Upcoming conferences:
* AICPA National Construction Industry Conference: Bellagio, Las Vegas, Nevada, December 11 and 12, 2003.
* TECH 2004: The AICPA Information Technology Conference: the Venetian, Las Vegas, Nevada, May 3-5, 2004.
* e-MAP: Management of an Accounting Practice Handbook. Has practice management guidance and tools on topics including consulting and development issues.
Publications and practice aids
* Litigation Services and Applicable Professional Standards--Consulting Services Special Report 03-01. Has guidance for practitioners on the standards, rules and laws that apply to serving as consultants, experts, triers of fact, special masters, mediators and arbitrators.
* Calculation of Damages from Personal Injury, Wrongful Death, and Employment Discrimination--Consulting Services Practice Aid 98-2. Discusses engagement scope and acceptance considerations, types of damages and approaches to damage estimation.
* Communicating in Litigation Services: Reports--Consulting Services Practice Aid 96-3. Covers organizational and technical aspects of an engagement or consultation.
* Marketing a Consulting Niche, edited by Allan D. Koltin.
Other relevant reports and practice aids include Providing Litigation Services--Consulting Services Practice Aid 93-1 and Communicating Understandings in Litigation Services: Engagement Letters--Consulting Services Practice Aid 95-2.
PRACTICAL TIPS TO REMEMBER
Here's an assortment of niche development tips from this roundup.
* CPAs can tap into the retail automotive industry by hiring former dealership controllers.
* For forensic accounting and family law consulting, always look at the attorneys on the other side of a case as a future referral source. Be nice to them--and if your side wins, don't gloat.
* The best place to find IT customers is among a firm's existing clients. Many clients have technology needs that show up during traditional engagements. * To compete in the litigation consulting market, one of the best things a CPA can do is be responsive to client needs and return calls promptly.
* In a manufacturing and distribution niche, large firms can focus on entire sectors, but smaller firms need to concentrate on specific businesses such as plastics manufacturers, software developers and automobile or aircraft subcontractors.
* To get started serving nonprofits, consult a state association nonprofits directory to see who is in your region. Offer to speak at nonprofit organizations' meetings or luncheons.
* For a real estate niche, a firm should talk to the key real estate developers in its area and find out what professional organizations they belong to. Next, contact those organizations and volunteer to speak on a topic that interests them.
MICHAEL HAYES is a senior editor on the J of A. Ms. Hayes is an employee of the AICPA and her views, as expressed in this article, do not necessarily reflect the views of the Institute. Official positions are determined through certain specific committee procedures, due process and deliberation.
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|Publication:||Journal of Accountancy|
|Date:||Dec 1, 2003|
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