Uncorking Synergy

In a shameless bit of self-promotion, I’m presenting a webinar on Wednesday, July 25 on how to grow your practice through new client niches.

Admittedly, it’s not exactly an “Aha!” new-found avenue to CPA firm growth, but nonetheless one whose rise has more or less paralleled the roller-coaster economy which has made traditional organic growth painstakingly slow, if not impossible.

One of my previous blogs showcased how Top 100-firm Eide Bailly began a health-care consulting niche specifically designed to address the considerable nuances that will no doubt accompany ObamaCare now that the Supreme Court has allowed it to stand.

I sincerely doubt that will be the only firm to stake a claim in what is still a largely untapped client service.

In a sneak preview of my presentation, one of the other routes to establishing a foothold in new client niches and helping forge a point of difference from your competitors is via a merger with a firm already established in that niche or an affiliation with one that could add to your existing service.

Case in point: Moss Adams the super-regional firm in the Seattle area, this week agreed to merge with Rabanal & Smith, a Napa Valley-based practice with – if you’ll pardon the bad pun – “deep roots” in the wine industry, particularly many of the local vineyards and wineries who often prefer to work with local businesses.

Through its Wine Industry Group, Moss Adams currently provides accounting services to more than 200 wineries in California, Oregon, and Washington. However the merger with Rabanal & Smith gives Moss Adams a long coveted toehold in Napa, the Holy Grail of wineries in the U.S. Like many such deals, the agreement affords the acquiree expanded personnel and back-office resources it did not have, while allowing it to continue giving personal attention to their client base.

The head of the Moss Adams’ wine unit was unsure if the firm would continue to make acquisitions of firms in the wine arena, but on a larger scale, the acquisition of Rabanal & Smith is most likely emblematic of what’s occurring throughout the accounting landscape in a number of client niches.

One of the oft-repeated mantras in the profession with regard to mergers is that bigger is not necessarily better, but better is better. Chances are you’ll probably know if a potential deal in any client practice area has synergy or not.

Even if you can’t tell a cabernet from a cabaret.