A Huge Number of Potential Buyers
|Details of a deal done in July 2022|
|Time scale||6 months||Type of Practice||Sole Practitioner|
|Payment||2 tranches||How paid||50% & 50%|
|Multiple||1.2 x fees||When paid||Completion & 12 months|
|Offers||4 offers||Office & staff||Office shut, kept 1 staff other staff retired|
|Results||Do some de-cluttering at home, do some long awaited DIY and some writing|
In July 2022, the owner of an accountancy practice in Fleet sold his practice for £120,000. Mr C was in his late 60s and he wanted to retire, so he spoke to Draper Hinks to help him through the process. The result was that he received more offers than he ever expected, and he was able to take his time to make the right choice for him, meaning he could retire happily.
Mr C first approached Draper Hinks to discuss selling his practice after receiving a mailshot, one of the key ways that we communicate with accountants. Mr C wasn’t immediately sure how he wanted to move forward, so his first priority was just to generally discuss his requirements with Nicola and the team.
Selling an accountancy practice is never an easy decision, but Mr C told us he was especially impressed by how patient we were in explaining the process and not pushing him at all until he was ready. He said, “My first impression was how professional Draper Hinks was. There wasn’t the sales and marketing approach that other agents seem to adopt. It’s hard to describe what a difficult decision it is to sell. I had a lot of concerns, such as is this the right time, will the sale be successful, how will I find the right purchaser, will it leave me enough for retirement, and so on.”
When Mr C decided to move ahead and sell his practice, he opted to work with Draper Hinks, and he found the whole process very smooth. He said, “Nicola was very prompt with advice, and she is very experienced and knowledgeable. She always offered very quick responses, and the advice was tailored to my specific circumstances rather than giving me generic answers to things.”
At Draper Hinks, we have a set process in place for how we work, and it’s a process that supports both the vendor and the buyer. We manage most of the process for our clients, but obviously they need to meet and talk with buyers themselves to ensure they make the right decision for them. Knowing that most people will have never been through the experience of selling a practice or fees before, we always set up what we call a ‘coaching call’. Before clients meet with potential buyers, we discuss with them in detail how to run the meetings, talking through the best questions to ask and what the buyer’s expectations will be. We explain how to structure the deal, the multiple to ask for and the time scale for completion. Mr C found the whole process that we set up to be well thought through, and always very professional.
When buyers put in their offers, we always look through them first to ensure they meet all the criteria set out by our clients, so that we don’t waste our clients’ time. Mr C had a range of offers to look through, far more than he expected. He said the most difficult part was choosing between offers, and he needed to see the front runners again in order to do this, something we were more than happy to arrange on his behalf.
Eventually, he felt confident in one particular buyer. Mr C explained, “I built up a really good rapport with the buyer whose offer I accepted. That was the most important thing. It was purely good fortune that he also made the best financial offer. But I am pretty sure I would have sold to him even if he hadn’t. He won’t be keeping my office, but there are a couple of staff members that will have the option to stay or leave, which I’m pleased about.”
Now that’s he officially retired, Mr C told us his first job will be to de-clutter his study, loft and garage. He’s then going to start a five year backlog of DIY jobs around the house, before writing some course material on financial planning. And, of course, he’s looking forward to being able to spend more time with his family. More than anything, though, Mr C shared with us that he is most looking forward to no longer having to put client demands as a first priority, that he’ll no longer have to deal with an increasingly frustrating HMRC, and that he is finally free from the ever-increasing regulatory demands of the Institute.
Mr C said, “I would happily recommend Draper Hinks to anyone who is considering selling their practice. Unless you have sold a number of practices already, you really do need someone knowledgeable to guide you through the process and help you avoid the pitfalls. If I had to offer anyone my top tips on what to do it would be to make sure you plan early, know what you want to achieve and take good advice. I went into this process full of questions and concerns, but I made my way through it with confidence as Nicola prepared me so well.”