The right choice for baby boomers
It's a buyer's market but you can still get a good price for your practice, as long as you plan well in advance
Who would be a partner trying to sell their interest in a firm right now? You
can still sell your accounting practice but chances are that you won’t get the
price you imagined for
it. The days when the sale of the firm substituted for a decent pension plan
appear to be, if not over, suspended for the time being.
Our story opposite details how prices in some areas have fallen below 1x
turnover, leaving disappointed sellers settling for a fraction of their ideal
price.
These are difficult times. The recession has played a large part in the
transformation. Revenues have fallen across all sectors and accountancy has not
been spared, even if some in the profession are feeling more optimistic about
the future.
But perhaps a greater problem is a failure to modernise. At a recent event,
one young accountant confessed that he started his own firm – and rejected the
idea of buying into the firm he worked for at the time – because of the sheer
scale of the work needed to bring it into the modern era.
What was the problem? Incumbent partners who saw the business as a lifestyle
choice and lacked ambition to grow, while suffering stifling distrust of the
internet and clients working with new technologies – alongside an inability to
deal with social networking and the opportunities it might offer in
communicating and engaging with clients.
As a result, the service offering had failed to update and client interest in
the business was in the process of seeping slowly away.
How do you sell a firm like that? It’s difficult. And partners would be wise
to read our article to see what is possible.
Time spent sorting these problems could well be profitable. Planning well in
advance for the sale, instead of doing it all in a rush, will produce a return.
It’s up to the baby boomers to make that choice.
