Accounting firms start most of their niches because they noticed a firm concentration of a particular type of client. For example, they might have a number of construction companies as clients, or restaurants, or physicians. A particular expertise has been developed, and the decision is made by the firm to leverage that knowledge to go after similar new clients.
In some ways, it is a bit of a wait-and-see attitude, a kind of once yearly exercise evaluating the new work and clients obtained over the prior year. It is typically done at a firm retreat.
As of late, I noticed a change in the modus operandi in that some firms are now becoming much more "proactive" in identifying business opportunities.
When Sarbanes-Oxley was enacted, a number of firms didn't just focus on the restrictions it would eventually impose, but rather looked for what opportunities would open up. They studied in detail the new work that might be available as well as how Sarbanes-Oxley would ultimately impact the offering of accounting and auditing services. Part of that process was how it affected the Big Four. Although not direct competitors, these firms were perceptive in analyzing and seeing how the impact of Sarbanes-Oxley on the Big Four would ultimately affect their firms.
The result was that some firms created new divisions to handle internal control work for public companies, or they built up their valuation services because those were included as prohibited non-audit services by a public company's external auditor.
I expect that more firms will be adopting this proactive approach with regard to their firm. It really shouldn't come as any surprise because that is what their clients are beginning to expect and demand of accountants. Clients don't really care about a historical presentation of their financial information, but rather are interested in forward-looking advice as to how they can prosper in a rapidly changing business marketplace.
