The majority of CPA, accounting, and tax practice are sold by practice owners via “for sale by owner” method. This should not be surprising as accountants are tasked to sell their businesses. This is because they have built the required skills, contacts, experience, and knowledge throughout their careers. Although they are well placed to sell their practices, a lot of tax practices for sale are completed every year. This is made possible with the assistance of a business broker.
It is advisable to sell through a business broker. This is because you will enjoy various benefits during the sales process. For instance, they can help you from initial marketing to buyer qualification, and provide advice and guidance on legal and transitional issues, which arise at different points. In most instances, they will drive a deal to its conclusion. This ensures both sellers and buyers remain focused on the overall objective and successful sale of business.
Real value of sales process
A broker has a major role in selling tax practices. The broker charges fees for handling the sale of tax practices and accounting depending on various factors. However, the average cost is less than 15% of final sales price. It is true this can present a considerable sum. For example, if the sale is 200K, the fees for broker can be 10K. If you add this with other professionals fees and taxes associated with corporate finance deals, your proceeds as the seller can decrease.
Brokers argue that they add great value to the deal as they ensure you get value for your business that is higher than what you would have attained yourself. The following are some of the things you should consider when choosing a broker.
In this case, you should get all facts right. Take into account the number of accounting practices that have been sold in the last one year. You should be wary of brokers that list several tax practice sales on their websites. This can be a sign that you may not get adequate attention to your deal. Thus, you should focus on completion rates.
Where and how will they market your practice? Is there a group of interested buyers. Reputable brokers are well-known within CPA community. Also, they generate new contacts through attending and presenting at chapter events.
You need to provide your terms for negotiation. Also, you should know what happens in case you decide to pull out of the deal.