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Niching Your Business With Kirsty-Lee Roberts

When you open and run a business in a unique industry, it is important to differentiate yourself from the competition and win over your audience. Entrepreneurs should find a specific business niche to target a market strategy, and the broader the market, the more businesses you can serve. You should also find a niche in your industry that has unmet needs and select your target clients, define an underserved need, research customer base, create your business plan and market your business to a specific audience. The good news is, If you think of a specific product that serves one of your unique needs, it can probably be classified as a niche business idea. And in today's episode, we've got Kirsty-Lee and she's going to discuss niching the current position of Australia's financials. 

Niching Your Business With Kirsty-Lee Roberts

Josh: G’day everyone out there in podcast land. I've got Kirsty-Lee from KR accounts here and she's going to be talking to us about niching and the current position of Australia's financials. So Kirsty-Lee, tell me, what drove you to niche into the trade and construction industry.

Kirsty-Lee: Hi, so I took on a business coach and it was an online program, and in there they had discussed a lot about how, if your message is targeted towards every business, you'll likely not to be speaking to any of them. They're not really going to go ahead with your services because you're very generic. So I had decided to test out my message being focused towards building and construction, because that's where my background comes from and I'm very passionate about it, and it also means that a lot of my clients are all kind of similar. They're all in the building construction trades, sole trader area.

Josh: Cool. We see it all the time. Definitely have the sniper approach, not the shotgun approach. And we hear it spoken about a lot and a lot of us hear, "Oh, we got to do this. We got to do this." And then we don't, or we think we will always try to, and then we just fall back. But one of the big things that I found is when niching, it's not about turning away know your audiencebusiness, would you agree? You'd still work with other businesses?

Kirsty-Lee: I do have quite a lot of clients that are outside building and construction. I just feel like building and construction is, I guess, where I'm meant to be, that's where I have the most knowledge. But I do take on, say, restaurants, mechanics, they're quite similar to building and construction anyway, makeup, artists, things like that. But it's just something that I just feel really passionate about, and I know that those building and construction and trade space businesses really need that help, so if I can provide that specialist help to them, I can help them overcome the problems that I've seen in many businesses that are quite similar.

Josh: A lot of businesses, they do the voodoo that they do well, but not everyone's a bookkeeper, not everyone's an accountant, not everyone's an IT person. You can't wear all the hats, so it's good to get to nice and then you know any of the certain products and programs that they might use, like, I'm sure you've come across simPRO and things like that. It's good to know how the data is being looked at and how they would like the reporting done. I find when you're niching, it's about getting your message clear on your website and all your marketing so that the businesses that you're talking to go, "Okay, you are the right person for me." And it makes it very difficult for them to compare apples with apples because there are apples and oranges, there's someone that does everything, which means they probably do nothing well. And there's someone that does something very, very well. Would you say that your experience has been the same?

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Kirsty-Lee: Yeah, most definitely. So the differences between, say, restaurant to building and construction are restaurants are very hard to cashflow forecast because their sales are the sales that they get on the day.

So it's very hard to predict, I guess, what their sales are going to be the next day or in a week, in a month, whereas building and construction, a lot of the work will tend to go over a longer period, smaller operators might have jobs for a day or two. Large operators might have jobs that go for 12 months. So with those larger jobs, you've got your progress claims, you've done your quote, so you kind of know what's involved. You can kind of forecast for the next 6 to 12 months of funding, or not so much what funding, but what monies they're going to have coming in from clients, what expenses they're going to have because they've quoted all those works.

Josh: That makes perfect sense. And people think a lot of the time, when you niche, people think, "Oh, it means you're just good at one thing," but I like to liken it to, I guess, a doctor. You go to see your GP and your GP will talk to you about any of the different elements that you have. But if you went to see a specialist, whether that'd be a dermatologist or a gynecologist or any of the other ologists, if you went and saw one of them, you would know that they've at least studied the same things that your normal GP has and then they've just specialised further, so they're as good as someone that can manage any books as well as being better in a certain area. Would that be fair to say?

Kirsty-Lee: Yes, most definitely. I went into a building and construction business a couple of years ago and they were focusing on manufacturing at the time and they had just started going into the installation of a particular product. And I remember I was there for maybe three or four hours, and I had said, "Can I have a look at your copy of your last BAS? I just want to see what you were claiming on your BAS kind of thing." And then the minute I picked it up and I went, "You're not claiming fuel tax credits." And they're like, "Oh, what is that? Are we entitled to that?" And I'm like, "Yeah, you've got machinery on site. You should be able to claim for your fuel tax credits for what you're using the machines for." And that they hadn't been claiming it about, I think it was about two years, the period that they could have claimed for. And that was worth over $40,000.

Kirsty-Lee: So if you're going with somebody that is maybe not experienced in the field, you could be missing those little things. It would be quite similar to me going somewhere that makes wine, I would have no idea about wine tax credits, and I wouldn't pretend to know. I can research it and find out the information, that kind of thing, but if I was looking after a wine business, that could be potentially something that I missed.

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Josh: Yep. That makes perfect sense, and knowing those little niche things can, as you said then, it could be a world of difference. 40 grand, that's a lot of money and that's something I think a lot of people should be considering. People build these awesome relationships with businesses, and one of the things that we strive on is we tell any business that works with us.

We say, "Don't just take our word for it. Go and take advice. Go and get an audit or an IT audit or a security audit or take advice from other IT companies, and bring it back to us or sit down with us at the table and we'll talk about what their findings were," because we know a lot about technology, but as you've just pointed out, there could be certain things or certain parts that we go, "Okay, we've missed that because there are some very specific pieces of software that would be great for their industry." And everyone grows by doing that.

Josh: And that's something, I guess, is good for any business too, is just to get a second opinion. We ask our clients to do it, and we think everyone should be doing that just to make sure that they can see what they're doing and what they're doing is right. As opposed to continuing to do what they've been doing and not wanting to change. And in be specificchanging this company, you're talking about, saved 40 grand. That's a decent whack of money by having someone else's eyes go over their books.

Kirsty-Lee: Yeah. Most definitely. It's something that if I come across something in a client's books, I might say to the accountant, "Hey, what do you think of this? Or I'm thinking we do something like this regarding this particular issue. What are your thoughts?" Just to run it past them, because when it comes to bookkeeping, I'm not the only person that has to look at your books. You've got the business owner, but then you've also got the accountant at the end of the financial year. So whatever I do affects both of those people so I need to make sure that both parties are going to be happy with the work that I've done.

Josh: Yep. You're kind of the middle man where you need to be able to represent the information, and I'm sure some of the stuff that you get given is chicken scratch and you need to polish it off and make it look amazing.

Kirsty-Lee: There's a lot of shoeboxes with receipts that might be faded or barely readable.

Josh: Receipt Bank. How cool is that? I'll be the first to say, when I started up my first entity, which was just myself as a sole trader, this is going back 17 years now, I was doing everything myself and keeping care of everything myself and I read multiple books on making sure I was doing everything right with the GST and then I got to 13 years ago where I then set it up with a trust, the company, and I went, "Okay, this is getting way too confusing." But I was too scared to submit it myself because I don't want to stuff up, so I just didn't for two years. The result, I was losing sleep and freaking out. I'm going, "I'm going to have the government knock on my door. They're going to find me. I'm going to be stuffed." I had QuickBooks, but I had done no BAS lodgements and it was shoebox accounting. It was terrible.

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Josh: I went and spoke to a bookkeeper and she said, "Don't worry about it, calm down. It's not that big of a deal. Just go through it and we'll get it sorted." It cost a few hundred dollars. They went through... and again, just the timelines on money positions, this is now 11 years ago. It costs a few hundred dollars.

So it'd be a lot more now but cost a few hundred dollars. They went through and said, okay, "Everything's sweet, it's all been submitted." I went, "Oh my goodness, the stress is gone." And that's what it's about, I guess, removing the business owner from the equations of things that they're not that great at, and putting people like yourself in their shoes, where they're able to use your knowledge and use them to the advantage, get $40,000 worth of savings, and know that they're in safe hands.

Kirsty-Lee: And it's even something like the ATO. I still get nervous when I call the ATO and that's what I do daily. So as a business owner, if you're worried that you haven't got your BASes submitted and you haven't quite found a bookkeeper, accountant yet, give the ATO call and explain your situation, and then more than likely going to give you an extension to be able to get everything organised and bring everything to date. Because they're not out there to get the people that are trying to do the right thing or trying to bring their books up to date. It's those people that are deliberately not submitting it. That's the people that they want to go after and that they want to get.

Josh: I'd liken that to back at school. One of the things that I wish that I did, although I do have the facade of someone that's an extrovert now, I can promise you at school I was not. And one of the things I always wish that I did was ask more questions in class instead of sitting there feeling stupid. I never called the ATO in the two years that I hadn't done anything, so I'm like, "I don't want to tell them, because I don't want to get in trouble, because I don't know what I don't know and I don't want them to know that I don't know what I'm doing and then they'll be like, 'Oh, now you're going to be audited. Now you've told us.' And I'm like, 'Oh, so don't tell them.'" And then I was just freaking out more and more.

Josh: As I've found out more recently, the ATO is there to help you, as you said, not there to hinder you. They want to work with you, and that was great advice.

Kirsty-Lee: It's always one of those things that you get clients coming to you and they're freaking out and they go, "I haven't submitted a BAS in two years," and it's like, "Okay, one step at a time. I'm going to contact the ATO. I'm going to get that extension just so you can sleep a bit easier." And there's a very real possibility that once you submit a BAS, you're probably going to get a fine. So you just prepare them for that and go, "Oh, they'll probably send me a fine." I think the last one I saw was like $440 for not submitting on time. But then I've had several clients that we've submitted late or we've had to call up to get an extension for reasons outside their control and they haven't received a fine. So it's just one of those things that I think you've probably got to be a little bit unlucky for the ATO to give you a fine. If it's your first occurrence, they're probably not going to find you. You're probably not going to have an audit. But that being said, the ATO might one day just start auditing everyone. We have no idea.

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Josh: Yeah, it's up to them. But I have found overall my dealings have been pretty good. I can't complain too much. They've been very lenient when I had some financial stress due to a breakup. I had expressed my concerns with them. They came to the party quite well.

So I was happy with that and that was just one less stress at an already tense time. Getting to the point of you niched your business, and now we've gone into a spot where with the current pandemic and health of Australia and on a larger scale, the world, we've got businesses that are either booming or busting. And one of the patterns that I have seen is that some people have niched, but they've done it in a way that has resulted in them having all of their income gone because all their eggs are in one basket. And there's obviously good ways and bad ways to niche, and you're dealing with a single category of business, and I'd imagine when they go gangbusters, you would be riding the wave, and then when they're not, you'd be feeling that pain as well. Have you noticed any of those ups and downs at this stage?

strategise in businessKirsty-Lee: I'm very lucky that the way that I've niched, it's a larger range of businesses. I haven't just niched to one particular area. I'm not a bookkeeper just for shopfitters. My range of niche is quite broad, so I think for somebody that has niched to those shopfitters, it would be very hard because nobody is fitting out shops at the moment. So I think there is a way that you can niche and do it successfully to your target market that isn't going to hurt you in downtown. Say for me, a downturn would hurt me if building and construction stopped. And we're very lucky at the moment that building and construction are still at this essential service during these times.

Josh: Yeah. Niching, I think, is sometimes as an example of saying before, don't be the keeper just for dermatologists. If you're the bookkeeper just for dermatologists, you're going to be in strife for it. If you're the bookkeeper for people that are just doing hair and makeup, can say straightaway, that industry is not going very well at the moment. It's about diversifying, but also niching, making sure that you're not pushing yourself into a box too much, your services and skills going in the right direction, but you're not so directed you're only talking to a single person with a single skill set. You're able to still broadly work with anyone in the construction industry, which is really cool.

Kirsty-Lee: And I'm very lucky too, at this time, that I have clients outside building and construction. I have a couple of restaurant clients who I was a bit concerned when the shutdowns happened and a lot of them have been thriving because of the takeaway side of things has gone up, so they're actually turning over more than I did before. Everyone's stuck at home, ordering food out.

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Josh: What do you think is going to happen to the commercial real estate and businesses?

When they've made that decision to pivot from being a sit-down restaurant, and I've seen businesses in Tenerife and all around Brisbane that have been higher class, nice restaurants, running an upper-class business, and then they've gone to doing takeaway and they've still kept some of that class there and things like what you're saying right now, they're making more money now. It would be very difficult, I think, for them to go, "Okay, economically, it's not as viable to reopen the restaurant." It has a bigger footprint. It has more insurances and they're then bringing in less money from it. Do you think businesses will change their mindsets and that this will be a big turning point or big aha moment for a lot of businesses?

Kirsty-Lee: Not necessarily. Say those larger prestige restaurants that people are ordering from, they got their names from being this magnificent restaurant that you go to and you have this wonderful sit-down dinner. If they went to just takeaway, they could be compromising the quality of the food, the vibe that you get from going there, so they've lost all that. But I feel like some other businesses that may be office-based businesses, they might choose to have more flexible working arrangements going forward because during these times we've proven that it can work. So provided the productivity's there, there should be no reason why businesses aren't able to offer those options.

Josh: I completely agree. And over the last 13 years, I've grown from a garage business, then we got a storefront and we thought this is great, and then we moved into Brisbane, and we thought this is fantastic. And we did all the, I guess, in quotation marks, "traditional steps" for a business to grow. And then I went, "What am I doing? Why am I driving into business? Why am I getting all the staff to come into the same central spot, deal with traffic, deal with toll roads and parking and all the other stuff that comes with it, to sit down and then connect into other people's systems?" So it was back in 2014 that we started a remote workforce, and that worked out to be good and bad. When 2016 came around that I decided, well I didn't decide, I guess, I found that we had the systems in place to be able to monitor the KPIs and make sure that we're able to see what people were doing, and the KPIs change and adjust over time as well. It's not like they just stay the same.

Josh: If you, for instance, were looking at what a mechanic was able to do, and how many cars they're able to service when they're working from a shop, and then you moved into becoming a mobile mechanic, obviously the number's going to be very different. And that's the same transition when people start working from their homes, it's not going to be as... You're not going to be able to use the same KPIs and the monitoring and things, and you really don't want to micromanage either. You want to make sure everyone still has that same ability to continue to work. And it's not for everyone. I've had staff that can't work remotely and they've told me, they said, "Look, I know I'm not as productive when I work remotely."

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Josh: And we sat down and tried to work out how to do that. But I still think any which way we look at it, it took two years for us to find the sweet spot, and we have an environment now where they can work from home or they can work remotely or whatever they want to do.

Overall, we'll see massive shifts and the software to support these new ways of business working will evolve and we'll see more abilities for people to have that monitoring, create those KPIs and make sure that all the businesses and strive with a significantly smaller carbon footprint, which can only be a good thing. For you, do you go on-site as well as do things remotely?

Kirsty-Lee: A lot of my work is done remotely. I do meet with clients to discuss their financials. Usually one or two days a week I'll try and get out there and see as many them as I can. I don't really have any that need me to work in from their offices, which is very lucky because we've put those systems in place so that they can work anywhere, I can work anywhere kind of thing. So I'm very lucky that I do get to work from home, but even back in the day, when I had an office job, I hated going in there because people would be talking and they would distract you, I'm very much like, "Just leave me alone so I can get my job done."

Josh: Yep. I'm the same. I find the most productive time slot for me is between 3:30 to nine o'clock in the morning.

always have a planKirsty-Lee: 3:30, what are you doing at 3:30?

Josh: No rest for the wicked. 3:30 to nine o'clock. Very few businesses are up. Very few people are distracting me and I'm able to just get heaps of work done without phone calls, telemarketers, emails going backwards and forwards, any projects and bits and pieces that need to have any loose ends tied off on, I can get finished. In answer of your question, I've got a YouTube video called The Mirror Mindset, and it's all around the person that you are inside and making sure that when you see that person in the mirror, then they match up, but most of the time they don't. I also go through some the eating and health habits that I changed, and I have very little sleep now compared to what I used to and still seem to work on a high level of efficiency, which I can record through all the different remote monitoring and the KPI tools that we've got implemented. Is there anything else that you'd like to go through that you think would be really great take-homes?

Kirsty-Lee: Yeah, don't leave your ATO issues. Definitely get them sorted because you will sleep much better once you've got them sorted and you're not worrying about the ATO being on your back.

Josh: Cool. I completely agree. And I know the stress and if anyone that is listening out there is looking for a second opinion on their books, it'd be very, very good for you to jump across to KR Accounts, we'll put a link here for you guys to check it out. Speak to Kirsty-Lee and see what she can do for you guys. '.

Kirsty-Lee: Thanks for having me.

Josh: No worries. I hope you've enjoyed this, and if anyone has any comments or feedback, make sure to jump across to iTunes, leave us some love and give us some feedback and everyone stay out there, stay good, and stay healthy.

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