Greetings from the road. We spent last week on/around Mackinac Island and are now traversing Michigan’s Upper Peninsula and eating pasties on our way to Duluth, MN.
I hope you found last week’s conversation about your next new hire to be useful. BV professional to increase your revenue? Or admin support to grow your profit? Of course, it’s not as simple as that. But you should consider which performance metric you are judged on (or you judge yourself on) and run the numbers to see which option makes more sense for you.
On to this week. The primary reason to specialize is that it is in the best interest of the clients we serve. It allows us to solely focus on them, to truly care about them, to patiently learn more about them, and create more value based on what they know they need (or what we know they need) … because we’re an expert in the niche.
And if you’re new to the blog, welcome aboard. This is what we do!
I knew John Borrowman, my go-to colleague for all things related to BV staffing and recruiting, would take note of last week’s newsletter. He thought my message was on target and added these pointers for a single-shingle shop (say that five times fast):
- Make careful distinctions about what you need to get off your plate versus what you’d like to get off your plate. The more of the former, the more you’ll pay.
- Even with those parameters as your guide, you won’t likely find the just right “Goldilocks employee.” Be prepared to be flexible.
- Initiative should be a strong suit of the person you want. Be sure you’re ready to guide and mentor so you get the most from that initiative.
We all start our practices (or positions) as generalists. We have little training, practically no experience, and likely no mentors. It’s almost impossible to specialize in the beginning. And we gotta pay the bills.
But as time goes on, we see what type of work we like (and are good at) and what kind of clients we enjoy serving. It’s time to pick a specialty—a practice area, industry niche, or a combination of both.
If you don’t specialize, here is what your classified ad looks like:
Need a valuation? I can value most businesses for most purposes. If I haven’t valued your type of business for the specific purpose you need, I’m happy to learn on your time and dime. The timing of my report may need to be adjusted accordingly. And since I don’t have any notable area of expertise, I compete primarily on the basis of price. I may not be the lowest bidder for your valuation project, but I will definitely be near the bottom.
But when you have a niche, your classified ad might read like this:
Need a valuation for your construction business? Look no further – that is all I do. Because of my reputation, I have a national practice that has enabled me to solve your valuation issues, multiple times, successfully. Because of my experience, I can also assist with operating expense analytics, financial projections, and debt negotiations. You build buildings … I build you. If it sounds like I can help, I’d welcome the opportunity to talk with you.
Who do you think provides more value?
Who do you think can charge higher fees?
Who do you think has fewer clients but earns more?
Who do you think has more time, money, and freedom to enjoy life outside of their practice?
Most practitioners I talk to say they don’t specialize because:
- They are afraid that it will limit them (actually, it focuses you—which frees up all sorts of time as you only pursue projects that are in your wheelhouse).
- They feel there aren’t enough specialty clients where they practice (if there are businesses in your specialty in your state, you have a state-wide practice).
- They believe they can’t bridge the cash flow gap while they transition from generalist to specialist (many others have done it—of course you can too).
If you don’t have a niche, you are hemorrhaging time and money.
- Time, because you have steep learning curves for all of the one-off projects you take on.
- Money, because you can’t charge the fees you deserve for the expertise you would otherwise bring to the table.
In real life
Most generalists command less respect by clients and peers than specialists. Is that how you want to be seen?
Most of the clients generalists serve are small. There is nothing wrong with that, per se, but is that providing all of the intellectual challenge you want?
Most of the work generalists perform is perceived as a commodity. As long as you are going to put in the time, wouldn’t you like to command higher fees?
When you have a problem that you want to be resolved, successfully, don’t you seek out a specialist? Isn’t what the specialist offers how you want/expect to be treated and served? What about your clients?
– If you like what I write about, tell a colleague.
– If something resonates and you want to reach out directly, email me.
– If you think we share common interests, connect with me on LinkedIn.
– If you want a sense of how well your practice is working for you, take this Practice Self Assessment.