I’ve heard a saying: “There are riches in niches.” Now, this may not be the best rhyming couplet, but it’s certainly some of the best advice you’ll ever get about starting your own business so it bears repeating. Choose a narrow focus, and then specialize. Become an expert in your field, build a reputation for a particular skill set, and own that space of the market.
To find your niche, you need to keep your eye open for opportunities.To find your niche, you need to keep your eye open for opportunities. Click To Tweet
While I was working at a Big Four accounting firm, I noticed two very important things. Firstly, clients seemed to have a really hard time finding quality bookkeepers, and often didn’t have full access to reliable financial data about their own company. Without a clean set of financials, the tax accountants were spending far more time than necessary on the client’s NTRs and T2s. And because the fee was the same regardless of how much time the accountants spent on the file, the accountants were essentially losing money. Secondly, there was no major company or brand that had established itself as the leading expert in quality bookkeeping (and bookkeeping only). None. Anywhere. In the world.
That was it—my niche. I wanted to create a bookkeeping business, Legacy Advantage, that would offer a win-win-win solution to the accountants, the clients, and the bookkeepers. If we could start a bookkeeping business that could provide a clean set of financials to the accountants, we could save the accountants time (hence boosting their hourly take-home) and also provide clients with superior financial data that would empower them to make better business decisions. If they were happy, they’d continue to work with us, and help us build a powerhouse bookkeeping brand through word-of-mouth and referrals. Win. Win. Win.
To solidify your niche market position, you need to specialize.
You might think that you need to offer your clients a full suite of services in order to attract their business and remain competitive, but you’d be surprised. While setting up Legacy Advantage, I quickly discovered that doing less opened more doors than it shut. How? Well, specializing in bookkeeping with Quickbooks Online allowed us to become experts rather than jacks of all trades, and this did two things. One: It enabled us to do things that other bookkeepers couldn’t, making us sought within our field. Two: It allowed us to complement rather than compete with accountants, turning those accountants into allies.
Your specialization need not be defined by what software you use, nor by doing work that others cannot or prefer not to do. I know some accounting firms that have defined their niche by focusing in on a particular industry. For example, a colleague of mine launched a business focusing entirely on offering accounting solutions to Creative Firms. This enabled him to zero in on business and financial particulars that are unique to the Creative Business Owner. Given the incredible growth of and interest in Marketing Agencies, PR Agencies, Photographers, Videographers, over the past few years, his company quickly became a go-to consultant for new and existing Creative Firms that were looking for accounting and/or business development insights specific to their industry.
Consider what can you do that no one else is doing. Can you provide specialized services to an industry that’s being under-served? Can you offer rare or uncommonly in-depth expertise with a particular technology or skill? Do you have a fresh solution to an old problem? Do you have a first solution to a new problem? If you can answer, “Yes,” to any of these questions, then you may have just found a great place to start.
In summation, it boils down to this: Go an inch wide and a mile deep, not the other way around. There are lots of companies skimming the surface. You have to dig deeper to find the win-wins, and when you do, you’ve got the makings of a great start-up.
Here’s a webinar on finding your niche.