When SFAS 141 & 142 first appeared on the scene in June of 2001, visions…
D.L. Heisey & Co., Inc.
Though it may not prove to be the windfall that some anticipated, SFAS 141/142 work can provide a potential market for the small shop to pursue. In the July issue, we considered the elements that give rise to that potential, and the competencies a practitioner needs to bring that potential to reality. In this issue, we look at the nuts and bolts of getting from here to there.
Consider, first, that you’re probably building market share with a constituency that doesn’t currently use your services. Your marketing message should convey how your competence, experience and SFAS 141/142 knowledge will add value to the organization. That message should be consistent, continuous and geared for the long-term. Some suggest that marketing messages fail to achieve client’s trade space mind-share until they’ve been read, observed, or heard seven times. Deliver your message via multiple channels: in person, print, internet (like this article), email, radio and – yes – even cable TV. Employ competition among those outlets as one strategic tool in your marketing favor.
One obvious target is the business broker involved in the purchase or sale of businesses and business interests. Also, don’t overlook attorneys involved in M&A work, corporate law and even marital dissolution. Seek an audience with commercial bankers for whom client audits are but one of several underwriting requirements firms must adhere to in getting and keeping asset-based debt and working capital. In each case, the tactical objective is to begin developing a referral network by offering your knowledge in SFAS 141/142 to serve them by enhancing their value in the eyes of their clients. Use the full range of channels to deliver your message and, again, make it continuous and consistent.
At the same time, seek subcontracting opportunities from larger appraisals firms, regional accounting firms and – yes, why not? – local offices of the Big Four accounting firms. Here, as well, your message should convey how your competence and 141/142 knowledge will add value to the services they already provide their clients. And have I mentioned consistent and continuous?
To be sure, your insight, technical mastery of quantitative analytical methods, designations and practice standards all play important roles in performing an engagement. One other key engagement discriminator not openly discussed in the literature – and of greatest import to the client – is the fee. One can’t help but wonder why a potential client would engage a small shop appraiser, as skilled as anyone in the art and science of SFAS 141/142 appraisals, and be satisfied paying Big Four accounting firm rates. To the consternation of some, the economics of competition has had its way with fees for fair market value standard appraisals in non-contested situations. One wonders if that same fate awaits SFAS 141/142 appraisals. And if so, why would a small shop appraiser not seek to capitalize on the inevitable and claim it as a strategic advantage in support of gaining greater market share? Therein, by the way, lies ample room for differing perspectives.
June 2001 signaled a significant shift in the way American business will organize and report on operations in the future. To the small shop appraiser this shift offers an opportunity for practice expansion provided the fair value and compliance with audit work paper standards are met. Realizing practice expansion through consistent and constant marketing, the strategic development of an intelligent referral network and sensitivity to others’ perspectives on appraisal fees combine to achieve smaller (or even single-shingle) shop SFAS 141/142 market share.