How top accounting firms choose what industries to target: Interview with IncSight

Being able to narrow down the types of clients your accounting firm services allows you to have more focus and control. It’s important to have a general understanding of the industries your team works the best with. From there, you can start drilling down on specific business sizes and business types that are most suitable for the level of service you want to provide.

As part of an interview series we’re running with a range of accounting technologists listed on the Amaka Advisor Directory, we spoke to Mike Jesowshek, Partner at IncSight and Podcast Host at Small Business Tax Savings Podcast. This is number three of four snippets discussing how the US-based accounting firm has used technology to create a better client experience.

Below, you’ll find the recording of the interview snippet, a summary of key points and the full transcript.

Key points on choosing clients for your accounting firm

  • Targeting specific industries is important to determining where your marketing dollars go
  • Start narrowing down based on your team’s existing expertise
  • The more experience you have, the more you can narrow down the industries based on who you enjoy working with Within industries, businesses of different size and type will work better with others
  • For example, IncSight found that though the fitness industry was a great fit, fitness studios in particular were too small for the level of service IncSight provides
  • IncSight loves building relationships with other firms so that they can refer clients that might not be a great fit to other trusted advisors
  • Unfortunately, as your firm changes, it’s likely that your services outgrow legacy clients and it’s important that you don’t end up overdelivering and underpriced

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Full interview transcript with IncSight

Gian Ottavio (Amaka)

Hi, everyone. Today, I’m joined by Mike Jesowshek, CPA brand ambassador at IncSight and also founder and host of the Small Business Tax Savings Podcast. For those of you who don’t know, IncSight is a full service accounting practice located out of West Palm Beach, Florida, offering accounting, bookkeeping, taxation, payroll and advisory services. Mike and his team are an industry leading practice that puts technology first for small, medium business owners.

Mike also doubles up, as I mentioned, as the founder and host of the Small Business Tax Savings Podcast, which has a mission of helping hardworking business owners overcome complicated taxation rules, which can often lead to over inflated tax bills. Thanks for joining us today, Mike.

Mike Jesowshek (IncSight)

Yeah, thanks for having me. Super exciting.

Gian Ottavio (Amaka)

Awesome. And I mean, just taking a more macro level on this, really keen to understand. I know we mentioned before that IncSight is sector agnostic, but when you’re profiling your customers and your clients, are there any specific parameters or fields that IncSight looks into when profiling and making sure that you are taking on the right customers for your firm?

Mike Jesowshek (IncSight)

Yeah, for sure. You know, we service a lot of clients in different industries, but we also target certain specific industries, especially when we look at marketing and we know where we’re going to put our marketing dollars. If we want to target a specific industry instead of being a generalist a lot of times, determining which markets we want to focus on just comes from experience.

You know, we’ve worked with this type of industry a lot, so we really enjoy working with them. That comes from the opposite side to, you know, we found out what clients we don’t work well with, whether that’s from a team knowledge or expertise or the specific industry just is not a good fit for us in the tech stack that we’ve tried to use in.

So that’s when a client comes to us. That’s exactly what we’re looking at. You know, some parameters are, you know, where do you want to take this business as an example. It’s not necessarily industry by industry, but also within an industry. We used to specialize in the fitness industry, working with fitness studios, gyms, things like that. And what we found out is that through our marketing dollars, we are finding a lot of clients interested in coming to us, but we found that the majority of the fitness studios that came to us were really too small for what we needed.

They were small and they needed this level of expertise, but we could only, you know, based on what they could afford, we could only provide this level. And so that helped us understand like, okay, the fitness industry might not be a bad industry to focus on, but now we just need to be more targeted within that industry. How are we taking up the people that we provide services best to and so I think it’s also understanding your service level too.

Are we here just reconciling bank accounts and sending a report and that’s it? Well, we’re providing some higher level service. Are we adding in some help on, you know, reporting and forecasting and say, how can we help you grow your business. If our goal and what we’re great at is how can we help you grow your business and be that partner on your team?

Well, maybe we might look and say, hey, those small business clients, they can’t afford what we’re great at. And so for that, it’s not a good fit. Other people might say, that’s a perfect fit. I’m not good at telling you how to grow your business. I don’t. That’s not my specialty. But I can get you a great set of books at a cheap price, and so that might be a perfect fit for them.

So we’ve used different parameters of that in learning from the clients we worked with to see what fits. Another thing that we’ve done as part of that is that if it’s not a good fit for us, how can especially if we’re continuously getting people in that industry or in that line of work, that’s not a good fit in.

How can we find somebody that we know like and trust we can maybe get them in front of? So like I said, even though they’re not a great fit for us, there are accounting firms that they are a great fit for. So how can we partner with them and say, hey, we’re getting an influx of leads of clients this size or in clients in this industry?

Not a great fit for us, but we know that this is your specialty. How can we partner with you to get these people in front of you and be another lead source for you, the clients that aren’t a great fit for us? Yeah, yeah. I think that kind of our approach when we look at accountants and general accountants, oftentimes we look at every accountant as competition and that’s something from the front that we’ve always said, you know, there’s so much business out there.

There’s so many businesses, so many different industries that we don’t look at every accountant or consultant as competition. Even accountants that service the same exact clients that we do, we don’t look like competition. We look at it as a great opportunity for collaboration, saying, What’s working for you, what’s not? We know that you’re going to take some clients away from us, and we know we’re probably going to take some clients away from you that decide to move.

And maybe it was a personality fit, you know, maybe there’s nothing wrong with the level of service that we enjoy, but they just don’t have a good personality fit with who they are working to. So we know that’s going to turn back and forth and we’re not afraid to spend time collaborating with people that work closely on the same stuff that we do.

Gian Ottavio (Amaka)

Yeah, no, and that’s awesome. I think the only way to actually even have that approach is learning from past experiences. You wouldn’t know what client is right for you unless you have picked up one that wasn’t the right fit for you. And it is a, you know, a continuous learning process from a practice perspective to say, okay, we know what our client profile looks like.

We have someone that can look after this client that doesn’t fit our needs. And I actually came to kind of understand as well, if you could shed some light on the impact that taking on the wrong client can have on the practice because I know a lot of practices. They don’t they typically wouldn’t take that selective approach for whatever reason, but they can then find themselves having some inefficiencies when they pick up clients that maybe aren’t the right fit.

Really came to understand your views on potentially some clients that you’ve brought on that haven’t been the right fit and what impact that can have on your firm.

Mike Jesowshek (IncSight)

Yeah, you know, as we go through this day on a daily basis, because the fact is that as your firm is growing, as your firm gets at different stages, in the lifecycle of your firm, you’re going to pick up clients that weren’t a great fit, but they’re still clients. And so we have we see that every day where we have a client that is a client, a current client of ours that was a good fit when we brought them on.

But now due to shifts and changes in how we do things that are no longer a good fit and you know, you can tell how detrimental that can be because you know, not only is it a time commitment, you know, we might be maybe underpriced. We’re over serving or we’re overdelivering and underpriced because you know, they were an old legacy client.

Another thing, too, is that our staff feels bad when they want to provide a high level service or a certain type of maybe higher end service, but they can’t. Oftentimes, it can be a detriment to the staff, too, because it starts like, I know they need this help. I do this for all of our clients. Can’t I just help them out in this area?

We’re like, well, they’re not paid for that. They’re not at that service level. So we can’t provide a service that they’re not you know, they’re not in but that’s that’s hard on the staff because the stats like I know what to do. I know how to fix this, but I just simply can’t. So yeah, we run into that issue a lot.

And oftentimes that comes from the situation where it was a good client or a good fit at one time. And then it’s no longer a fit. You know, as you grow deeper into the growth of your firm.

Gian Ottavio (Amaka)

Yeah, no, that’s really valuable insights and thanks for sharing that.