Selling an accounting practice can be a challenge for any business owner. However, with careful planning, you can sell your firm at the right price to the right buyer at the appropriate time. Here are some things to consider when contemplating how to sell an accounting firm in Australia.
1. Understand your business’ value
Several factors will impact your firm’s worth, such as its size, profitability and growth potential, such as:
- Its reputation — The better your firm’s reputation, the better the price, as it ensures the buyer that the business will remain strong.
- Its diversified client base — If your firm serves various clients in different industries, it will be more attractive to potential buyers. A diversified client base provides stability and potential for growth.
- Its management team — If your firm has a team of experienced and capable managers, buyers will be willing to pay a premium. A strong management team can provide continuity and help grow the business, which is attractive to buyers.
- Its financial position — A solid financial position provides stability and gives the buyer confidence that the business will continue to be successful.
- Its staff — If your firm has employees who have been with the company for many years and have a lot of experience, then buyers will be willing to pay more. After all, inheriting experienced staff grants buyers the knowledge and expertise to help the business grow and succeed.
2. The costs of selling
Consider costs like broker fees and legal fees. Once you clearly understand these costs, you can factor them into your asking price.
3. The time of the sale
When you sell your accounting firm plays a role in your successful sale. For instance, some businesses have busy periods, such as tax season for accounting firms. Selling your firm before the busy season can help your buyer hit the ground running, but selling it during a low period may make your firm seem unprofitable and unattractive.
4. Documents needed
Selling your accounting firm must be done with the appropriate documents in hand. These include:
- Profit & loss statements for the past 2 to 3 years
- Current balance sheet
- Cash flow statement
- Business tax returns for the past 2 to 3 years
- Copy of the current lease
- Proof of insurances policies
- A non-disclosure/confidentiality agreement
- Personal financial statement completed by the buyer
Having the appropriate papers ready will save you the hassle of gathering them at the last minute.
Ready to sell your accounting firm?
If you’re ready to make the decision to sell your accounting firm, contact Kelly Partners today. Our team of business accounting experts have been offering top-notch services for years, so you can rest assured that your business will be in good hands after the sale. We build careers and grow businesses — it’s our mission.
Contact us today to talk about your legacy!