Vendor Story Q2

This is a case study from a practice we sold recently  
Fees sold£ 76,000WhereHampshire
QualifiedMAATAge72
Time scale4 monthsType of PracticeSole Practitioner
PaymentThree tranchesHow paid50%, 25% & 25%
Multiple1.1 x feesWhen paidComp, 12 mths and 24 mths
Offers3 offersOffice & staffNo office, no staff
ResultsShe is now looking forward to having the time to travel, spending time with grandchildren and all the family.  Being able to expand hobbies and learning.  But most important not having to be tied to the “Accounting Clock”.

We were approached by this vendor.  She thought she ought to sell and retire but she still loved her job and knew she would miss the interaction with the clients, helping them through accounting and tax difficulties.  She said she would not miss the 7 days a week working.

We asked the vendor to fill in our shorter questionnaire because her fees were below £100k and sign our proposal giving us permission, under GDPR, to market her practice.  On receipt of the paperwork we were able to do a search of our database and Identify a number of potential buyers to approach on her behalf.  We found a number of potential buyers and the vendor chose who she wanted to have meetings with and we set them up for her.

Before any of the meetings took place I had a Coaching Call with her to run over the process, what to say to buyers, how she could structure a deal, timings for indicative offers to be in by and when she wanted to complete the deal. 

With regards to the Coaching Call the vendor said “it was extremely helpful in understanding the sales process, the meeting preparations, negotiating and what to expect in the meeting.  Nicola advised that I would be leading the meeting, so I took lots of notes during the Zoom call. I would consider this Coaching Call to be essential for anyone looking to sell their practice”.

The vendor rated each buyer as being excellent and her problem then was which offer to choose, from the three that she received.  She liked each buyer the same, which made her decision more difficult.  I pointed out that it was not a case of one offer is right and the rest are wrong because each buyer had the willingness and incentive to look after all of the clients.   In the end it came down to the buyer that had bought before and could give the vendor help and guidance from experience. 

The next step was to book the due diligence meeting, which went very well.  The buyer put forward the contract for the seller to review and sign.  We were able to recommend a lawyer for the vendor to use before signing the contract.

The vendor said that most difficult parts of selling her practice were:-

  • Making the decision to sell.
  • Getting the right contract and conditions for her practice.
  • Transferring the data after completion.

She found that working with Draper Hinks was good because we were always ready to give help when needed and provide a discreet and professional liaison between her and the buyer.  She also said that working with a broker helped with the finding, vetting and matching of suitable buyers to her particular style of working.  We were able to assist in understanding the right approach to the negotiations and we acted as a neutral party where issues had to be resolved.

We asked the vendor for her top tips for anyone thinking about selling their practice, and she came up with this helpful list:-

  • Once you have decided to sell then go for it.
  • Ensure you do your homework and attend the Coaching Call.
  • Seek legal advice on the contract from someone used to doing these types of deals.
  • Sign an NDA before due diligence.
  • Once the process starts, keep the momentum going.
  • Talk regularly with the buyer to resolve any issues early.
  • Be warned that the difficult part was running the practice whilst managing the sale. 

We were very happy to help this vendor find a suitable buyer, she wanted to let us know that she could not thank us enough for the valuable help we gave her.

If you want to sell an accountancy practice or buy an accountancy practice please get in touch with me, Nicola Draper, on 01788 816440 or email me at n.draper@draperhinks.co.ukWhy not book a confidential chat with me using https://calendly.com/draper-hinks/q_a