August 2019 Newsletter

Draper Hinks Newsletter

August 2019
Hello, I’m Nicola Draper.  I run Draper Hinks and have done so since 2004.  We sell only accountancy fees and have completed over 290 deals.

We are very active in the market place for buying and selling accountancy practices.  I work with all the sellers, so if you are looking to sell in the near future, please email me at n.draper@draperhinks.co.uk.
Nicola Draper founder Draper Hinks
Did you know about the 10% introductory fee being offered by Draper Hinks?
We know that buyers keen to grow through acquisition will meet many sellers but do not buy every practice they see.  Draper Hinks would like to hear about those firms/fees that you have not bought, for whatever reason.  We would like to speak to those vendors and are offering you 10% of our fee for the introduction, payable on completion of the deal after we have been paid.  The bigger the practice introduced to us, the larger your introductory fee.

If you are interested contact Nicola Draper by emailing her at n.draper@draperhinks.co.uk.
Here are three case studies of practices we have sold within the last 12 months:-
No. 1  
Fees sold £316,987 Where South West
Qualified FCA FCA FCA Age 68, 66 & 61
Time scale 7 months Type of Practice 3 Partners
Payment 3 Payments How paid 33%  33%  33%
Multiple 0.85 x fees When paid Comp, 12 and 24 months
Offers 2 offers Office & staff Office and staff retained
Results 1 Partner retired, 1 stayed on 12 months and 1 remained p/t for 3 yrs reducing time worked
   
No. 2  
Fees sold £236,000 Where Dorset
Qualified ACA Age 64
Time scale 8 months Type of Practice Sole Practitioner
Payment 2 tranches How paid 50% and 50%
Multiple 1 x fees When paid Comp & 18 months
Offers 2 offers Office & staff Office and staff retained
Results Vendor concentrating on his property portfolio
   
No. 3  
Fees sold £200,000 Where Yorkshire
Qualified FCA & QBE Age 56 & 57
Time scale 3 months Type of Practice 2 Partners
Payment 1 off payment How paid 100% paid at a discount
Multiple 0.65 x fees When paid Completion
Offers 2 offers Office & staff No office and no staff
Results Both vendors moved to the south west to retire, enjoy life and relax
Hello, I’m Diane Crawley and I am the Office Manager for Draper Hinks.

Did you know that we can do a bespoke mailing for you if you are not having success in acquiring fees and want to grow your business?  If you would like to know more please call me on 01788 816440 or email me at d.crawley@draperhinks.co.uk and I will be happy to discuss it further.
Diane Crawley, Office Manager
Here are three testimonials from vendors that were happy with the service offered by Draper Hinks in 2018:-
Testimonial 1

“I heard about Draper Hinks through circulars.  Draper Hinks has a good reputation.  There was an initial meeting that was professional and straight away we felt we were in good hands.  We found dealing with them was easy.  Nicola was able to anticipate our concerns and quickly gave good advice.  There was a lot of information that needed to be pulled together for the report, the buyers said it was a lot more than they were used to seeing.  I would be more than willing to recommend Nicola.  Without DH to steer us we would never have coped.  A broker can help the vendor avoid a lot of the mistakes that might otherwise be made.”

Vendor – David Shackelton                                             Cheshire
Testimonial 2

“I found out about Draper Hinks from their mail shots.  We met with Nicola a couple of years before the sale and thought DH were a company we could work with.  We have found working with Draper Hinks to be excellent.  They always responded promptly to our queries.  First impression was that they were professional and knowledgeable.  The process was seamless.  They helped us through what was a new and stressful process.  You should use a broker because of their expertise, back up and market knowledge.”

Vendor – Robert Miller                                    Hertfordshire
Testimonial 3

“I heard about Draper Hinks from a letter sent in the post.  Working with Draper Hinks has been very easy.  They are approachable but also very professional.  I found them easy to talk to.  The interview process with buyers was very well arranged.  They were always available to talk.  When selling your practice it is important to always have someone else to talk to.”

Vendor – Michael Hanby                                                 County Durham

Practices for Sale

 

Reference Area Amount Description
346/190725 West Midlands £525,000 Two directors.   One looking to retire, the other wants to stay on post sale.  Buyer needs to be qualified and audit registered.  Fees of top 20 clients total £134,104.  Meetings to be arranged on an individual basis.
323/190531 Cumbria £270,000 Vendor looking to retire.  171 clients with average fee of £1,578.  Top 20 clients’ fees total £113,300.  Buyer must be Chartered or Chartered Certified.  4 staff (2 part time and 2 full time).  Premises being retained by vendor.
Income Multiples Paid in the last 12 months
2018   Average income multiple paid Lowest income multiple paid Highest income multiple paid Lowest income multiple offered Highest income multiple offered
Q 3 Jul – Sep 1.02 0.80 1.30 0.50 1.50
Q 4 Oct – Dec 1.06 1.00 1.15 1.00 1.15
2019
Q 1 Jan – Mar 1.03 0.75 1.30 0.50 1.30
Q 2 Apr – Jun 0.98 0.75 1.20 0.60 1.20
David’s Diary

Welcome to the next instalment of David’s story since selling his practice through Draper Hinks in October last year.

In 2 months’ time all clients will have been through the “cycle” and I should start feeling the benefits of others doing the work and getting themselves known to the clients.

One of the elements of our agreement was my staying on for 3 years to facilitate the transition. Two thirds of the clients were happy with the move but there were others who proved quite wary.  Admittedly mistakes have been made or issues overlooked but I think one has to expect this in any sale or merger. I was a bit upset to lose a few clients and especially those where I had thought the relationship was strong but we have other clients who are growing and new clients to replace the ones that have gone.

I am sure that there have been things we could have done better or which could have been better anticipated. One thing for sure is that it will not all go according to plan. Over the first couple of months set aside as much time as is needed to:-

o   go out and visit the clients

o   offer a meet and greet evening or evenings

o   offer one to one meetings

o   ring and e-mail as much as possible

o   make the clients feel welcome and engaged

David Shackleton

 

 

 

  Lisa Shenton, Admin Assistant

 Hello, I’m Lisa Shenton and I am an Admin Assistant at Draper Hinks.  I am the person that will be sending these regular Newsletters to you so look out for emails from me in future.

Ø I will also be working on increasing Nicola’s LinkedIn contacts, so look out for my message, so that I can invite you to join our closed LinkedIn group – Growth through Acquisition with Draper Hinks.

I am also the person to notify if you wish to update your records in any way so please let me know if you move office or change your email address, so we can keep you updated.

Please email me at l.shenton@draperhinks.co.uk
Next step
We want to hear from you if you want to sell or buy fees.

If you are looking to sell your fees then email Nicola at n.draper@draperhinks.co.uk.

If you are looking to buy fees then email Diane at d.crawley@draperhinks.co.uk.