A recent article from the Illinois CPA Society discussed the power of niches within the accounting and advisory industry. Walt McGrail, managing director for CCA, provided his insight on recognizing and seizing opportunities. The following is an excerpt from the article, reprinted courtesy of Insight, the magazine of the Illinois CPA Society. For the latest issue, visit www.icpas.org/insight.
“Walt McGrail, CPA, managing director with Chicago-based Cendrowski Corporate Advisors, says the cannabis niche found him.
‘I worked with a young attorney in Chicago who saw an opportunity to launch himself into a newly legalized industry back in 2015,’ McGrail recalls. ‘He was willing to oversee my learning curve to make sure that I could provide him with the right expertise in this area. It was serendipity.’
Since then, McGrail has helped cannabis businesses and dispensaries with tax planning and business organizational structuring. The cannabis niche roughly translates to about 6 percent of the company’s top line. And while the cannabis space is the latest industry the firm is serving, McGrail says going niche isn’t anything new for Cendrowski Corporate Advisors.
‘We made that decision 20 years ago,’ McGrail says. ‘Very early on, we decided that the traditional green-visor accounting services shouldn’t be the entire scope of our practice. We branched out into things like valuation, expert testimony, and forensic accounting. So, when something new—like cannabis—came along, we weren’t afraid to jump in with both feet and take a stab at it.’
McGrail strongly advises other CPAs to consider the cannabis industry. ‘In my lifetime, the federal government will remove the undue tax burden on cannabis—even if they don’t somehow adopt it as a legalized substance—and that will create opportunities for folks like me,’ he says.
In Illinois, dispensaries are on track to sell more than $1.5 billion worth of cannabis in 2021, according to data from the Illinois Department of Financial and Professional Regulation. ‘I think cannabis as an industry will continue to grow,’ McGrail says. ‘The weight of evidence is just insurmountable that the industry is here to stay. The best thing I can tell you is you probably have clients that are interested in the space—and they’re going to go somewhere else where they’ve got the expertise.’
But even if cannabis isn’t right for your firm, McGrail’s parting words of wisdom apply to all CPAs seeking their niche: ‘If you want to add an expertise or a new venture to your professional practice, you have to learn as much as you can about that industry or that particular aspect. You can’t go into it blind. You need to go out and educate yourself—whatever it takes so that you can provide expert advice to your clients.'”