Strategies to Specialize Your Bookkeeping Firm in a Changing Industry
Feb 27, 2023If you're a bookkeeping business owner, you might wonder how to increase your revenue and focus your services on a niche market. One market that has proven highly profitable for bookkeepers is the legal industry, specifically attorneys and law firms. In this blog post, we'll explore why you should consider converting your bookkeeping business from working with all types of clients to working with only attorneys and law firms.
Moving from a generalist bookkeeper to working exclusively with attorneys took time. Once I decided to specialize, the marketing shift slowed down my sales funnel. I had the cash in the bank to pay my bills throughout this transition. Although it was temporary, the results were worth the effort. I can't be where I am today without making this move.
This week in the Lab, we looked at what can go wrong with messy trust accounts. We keep saying, "this is job security," because AI could not detangle the various situations when working with lawyers. It requires so much brain power and experience to detangle these accounts. AI can take over a legal bookkeeper's job someday, but that day is way down the road.
Why Lawyers and Law Firms Make a Great Niche Choice
Most lawyers are willing to pay top dollar for quality legal bookkeeping services. As a result, bookkeepers who work with law firms can expect to work with highly professional and respectful clients who value their services. Attorneys are professionals who know the pain of getting documents from their clients.
High-Profit Margins and Complexity
Attorneys and law firms tend to have higher profit margins than many other businesses. This is because their services are often specialized, which creates complexities in bookkeeping, and our knowledge of how to present this data puts us in high demand. By working with this market, you can command higher rates for your services, resulting in higher profit margins for your bookkeeping business. They also have complexity in compensation models, client expenses, and trust accounting. The trifecta!
Working with Lawyers Requires Specialized Knowledge
Working with attorneys and law firms requires specialized knowledge of their industry. Focusing solely on this market allows you to become an expert in their specific needs and requirements. This knowledge will set you apart from other bookkeeping businesses and allow you to provide more value to your clients.
Attorney Provide for Consistent Work
The legal industry is known for its consistent work. Unlike other industries where work may ebb and flow, attorneys and law firms generally have a steady stream of work year-round. This means you can count on a consistent workload, providing a stable income.
"I'm in! What do I do to get there?"
Did I convince you to want to move into this industry? I hope so! But you may be thinking, "what are the steps"? Below are some strategies to specialize your bookkeeping firm:
- Now that you have identified your niche market, it's time to tailor your services to meet their specific needs
- Redefine your website so it is crystal clear who your expected client is. Here is my website, and within seconds, you know I only work with attorneys.
- Do your homework. Learn the industry. Take our course to fast-track your learning. Join the Lab to learn all about the intricacies of legal bookkeeping. Let us help you!
- Listen to law firm podcasts, google, and expand your knowledge of your clients. Learn the different practice areas.
- Offer unique benefits that set you apart from your competition
- Invest in the latest technology and software to give your clients the best possible experience--find your set workflow!
- Tell everyone you know what you are doing -- announce it to the world. Start pumping out blog content or social media content targeting your posts to attorneys.
These changes will set you apart from a "generalist" bookkeeping firm. You will have a "deep" knowledge of the industry. Additionally, specialization allows you to speak the client's language, which in our case is attorneys.
Develop a Pricing Strategy
Establishing a sustainable pricing strategy is essential for any business, and bookkeepers are no exception. A few tips that can help you develop an effective pricing structure include:
- Developing flat-rate packages instead of hourly rates
- Focusing on the value of your services
- Utilizing package deals
- Making sure your pricing is aligned with the services you are offering
- Offer high-level services like budgeting and forecasting or financial analysis that includes benchmarking and KPIs
Remember, having a specialized firm means charging more than your generic firm. Being a niche firm allows you to streamline not only your pricing but also your workflows.
Maintain Exceptional Customer Service Standards
Treating your customers like the professionals they are is essential if you want to earn and keep their loyalty. You can do this by developing personalized service plans catering to each law firm client's unique needs and requirements. Additionally, you should promptly respond to questions and concerns so your clients know they can rely on you. When clients know they can trust you, they're more likely to choose your business over a competitor's.
Conclusion
I will never tell you that this was an easy move. I had many freak-out moments where I had to phone a friend to walk me off the ledge of stopping and not staying on the path of specialization. I am so glad he did. As I always say, moving my firm to work exclusively with attorneys was the BEST career decision. I want all bookkeepers to think good and hard about where this industry is headed. You will be so happy you chose one industry or one vertical to become the person known for this work. It will make your life easier.
We discuss this topic in the Accountant's Law Lab, our mastermind group. We can help you plan and strategize the move.
Do you want to join our private group? We have a large collection of videos that you can learn from, and we hold weekly meetings every Friday at 9 am PT/12 pm ET.
We would love to have you join our group.
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