Don’t Despair, there are other Options than Simply ‘Closing Up Shop’

Don’t Despair, there are other Options than Simply ‘Closing Up Shop’
I must admit, I have been a little surprised of late by the number of practitioners that have advised us that they have closed their practices. In part this is due to retirement and at other times ill health has been a contributing factor. It does leave me wondering “were they simply unable to sell their practice?” or perhaps they didn’t even try.

In this day of prospective purchasers screaming out for acquisitions, particularly in the CBD and suburbs, it seems such a waste not to even endeavour to achieve a win-win for both the departing practitioner and a colleague in search of growth.

It’s interesting; we are currently selling a practice for a sole practitioner who wishes to depart the profession prior to SMSF licensing requirements in July 2016. Whilst they haven’t shared their intention with most of their clients, the subject was mentioned to one client who responded “oh, I suppose that means I will have to go and find myself a new accountant”. Cleverly, the practitioner responded with “nah, no need, that’s my job. I will be finding you a suitable replacement”.

So in doing so, it’s a matter of identifying the options. Obviously for the larger firms, there is the option of selling their equity to another partner or perhaps a staff member. This is an excellent form of succession. For smaller firms, with time permitting and depending on the seniority of staff, it is perhaps possible to also grow an internal succession plan.

There is also the possibility of a merger, although leave plenty of time for this approach as it typically takes longer to achieve the right outcome and is not currently the first choice of those parties looking for growth. There is the option to sell to a related service provider such as a financial planner, although this can be problematic.

Then, there is the option to sell to a peer, another accountant in your local area or one who is wanting another footprint in your local area.

The sole practitioner’s practice that I mentioned earlier is based in the CBD; yet we received around 50 enquiries within the first week of its promotion. If you are regionally based, you may not receive quite that level of interest, however please keep in mind that it only takes one willing buyer to achieve a transaction.

So please, please, please, before simply closing the doors on your many years of hard work and displacing your dear clients, give us a call and have a brief chat regarding the prospects of potentially selling your firm.

Within five minutes we will be able to a recommend a course of action that will not only benefit you, but also your clients.

Speak with Michelle Knights on (02) 9233 4333 or e-mail michelle@robknights.com.au