Starting your own accounting firm was a good first step toward professional independence, but now you’ve come to a fork in the road. Should you offer general accounting services or specialize in just one field? If you’re just starting out, staying generalized might seem like the smart bet. If you can build up a good mix of private and professional clients, your firm is well-buffered against downturns. Setting up as a boutique accounting firm has its own advantages, and you might wind up specializing in just one kind of accounting service as your career matures.
What Is a Boutique Accounting Firm?
So what exactly is a boutique accounting firm? Accounting firms very rarely fit into neat, well-marked boxes labeled “general services” or “IPOs-only.” Instead, most firms fall somewhere between these poles, perhaps with a few preferred areas of practice, but a general willingness to take any client who comes through the door.
Imagine that you really like helping new businesses find startup capital in Iqaluit, but discover there aren’t enough entrepreneurs in Nunavut to do that full time. You might wind up spending 20% of your time on startup business financing and the rest just doing payroll or filing taxes for ordinary people. If you do wind up finding a full-time niche you enjoy, it’s worth considering the benefits and the challenges of becoming a boutique accounting firm.
Pros and Cons of Boutique Accounting Firms
As you weigh the pros and cons of specialization, remember that times change and so do markets. If you hyper-specialize in filing foreign tax returns, for instance, a single rule change at the Canada Revenue Agency (CRA) could fold those returns into the domestic market and change the filing status of your entire client base overnight. Ask yourself whether the pros and the cons are likely to hold true 10, 20, or 30 years in the future when you’re thinking about retiring.
- Specializing in a field often lets you charge higher rates for your services. People generally pay more for a tax specialist when they’re facing an audit, and you can capitalize on that.
- Developing a reputation for excellence in a single field draws business to your firm, rather than you spending time marketing to and locating a client base. Your reputation as Canada’s ranking expert in mergers could have other accountants referring their own clients to you when their clients need that service.
- Boutique accounting firms enjoy a measure of job security. As long as their field exists, their services are in demand.
- Boutique firms also face insecurities. If changes in your field make your special skill set obsolete, you need to adjust your services to the new market and possibly find yourself learning new skills and tax rules.
- Niche accounting firms sometimes have to turn away business.
With a Tighter Focus Comes a Higher Profile
Consider what a focused approach can do to your reputation. While it’s certainly gratifying to find yourself as the go-to expert in forensic accounting or data security, being the best in Canada raises your profile considerably. Where a generalized accountant can usually handle a few small mistakes on tax forms or uncrossed-Ts in a contract, when you’re the country’s foremost expert in blockchain audits, your mistakes make headlines.
Marketing Your Boutique Accounting Firm
If you’re sold on boutique accounting, think about how to market yourself. Niche marketing for a boutique accounting firm is a study all its own, but you can join professional networks and periodically conduct market research to focus your efforts on the most productive potential clients searching for your unique services.
Adopting a focused approach can make your boutique accounting firm wildly successful. If you understand the risks, you can carefully consider your options and turn your boutique accounting firm into a success. Collaborate with clients, stay on track, and grow your firm with QuickBooks Online Accountant. Sign up for free.