Things To Consider When Selling An Accounting Firm
Much like selling any business that may have been built by a family, selling on an accounting practice is going to be a complex process, even for the most dedicated of sellers. It is also going to be a process that is very long.
If you are looking to sell due to retirement or other commitments, it’s important to know what you want most out of the sale, so you can shape the best deal for yourself and any staff that are included in the sale.
With that in mind, what are some of the things to consider when you are selling an accounting firm? Here is a short guide that outlines everything you should know when you’re getting ready to sell your accounting firm.
How Much Is Your Firm Worth?
First things first, how much is your firm actually worth? It is worth having an accounting firm valuation before deciding on an overall sale price.
Larger accounting firms are usually more expensive to buy, making them slightly less appealing for those who may be looking to purchase an accounting firm to build up. Other factors to consider would be where the firm is located, the staff that come along with it, their training, and of course, the clients and technology.
Is Selling It Open-Market The Right Choice?
It’s also worth considering the use of an internal or external succession when you are looking to sell. Is there somebody on your current team who could take over as the head of the firm? If so, for many people, this is a more ideal solution than selling to an external and unknown buyer.
How Might Your Staff React?
It’s worth considering how any staff in your firm will react to your selling. After all, nobody is going to want to purchase a firm that has had everybody check out before final confirmation.
You will need to discuss the selling of your company with your staff and gauge how they feel before putting your accounting firm on the market.
Are Your Clients Good Enough To Boost The Sale?
Good clients can be incredibly hard to come by, and while it may seem more impressive to have 1000 clients on your books, having 200 well-paying clients who are regular income are better for business, and they are also better for sales. Therefore, it’s worth looking through your client list and assessing whether your clients are good enough to help you make a successful sale.
How Can You Increase The Sales Price?
If you have a high number of clients who are looking to leave upon hearing about the sale, this is not going to bode well for the sales price. You also need to consider factors such as payment plans when making a sale, as if you want to be paid 100% of the value of your firm up front, this is likely to result in fewer potential purchasers. In some instances, it may be best to seek advice about how you can increase sales price before putting your firm on the market.