Truforte Business Group can offer accountants unique opportunities to advance their CPA practices by capturing market share through the acquisition of Florida accounting businesses for sale.
We offer assistance with all types of Accounting Businesses, including: Tax practices, Financial planning, Book keeping, CPA firms and Accounting practices.
Truforte’s industry knowledge and experience as professional Florida Business Brokers will help ensure clients meet their goals in the Buying and Selling of Florida accounting businesses.
Are you looking for your next investment? How about looking to retire from your accounting practice? Both buyers and sellers can benefit from the sale of accounting businesses when there is transparent insight into the transaction. Understanding what to look for as a buyer or a seller is critical to maximize your earnings potential and make strong investment decisions.
Finding the right accounting business for sale takes a significant amount to due diligence, research, and knowledge. You don’t want to enter into a binding contract that doesn’t meet your basic criteria or set you up for long-term success. Consider the following things when looking to buy an accounting business:
The size of a potential accounting firm is an important consideration. There isn’t a wrong size accounting firm to buy; however, your personal preferences will impact the size route you take. A smaller firm may be easier to manage and can give you more growth potential when expanding options while a large firm comes with a higher workload but also increased revenue. If this is the first accounting business for sale you are interested in buying, are you ready to take over a large company?
Consider the growth potential
Growth is a key consideration when it comes to the long-term success of the business. Look at the financial statements to see if revenue has increased over time. A firm with stagnant or decreasing revenue might indicate issues in customer retention. On the contrary, steady growth highlights a strong customer base and a solid business model. Additionally, look at the geographic area of where competitors are located. If the market is saturated in that area, the prospective accounting business might have trouble growing inorganically.
Compare price to cash flow
It all comes down to the bottom line, right? Price is essential to understand, including the specifics of fixed payment agreements for exiting partners. The purchase price might look good on paper, but analyzing the underlying contract might uncover salary and bonus clauses that aren’t factored in. Before you begin your accounting business for sale search, talk with a broker on your preferred price range. You don’t want to start a new business that goes over budget right away.
Find a workload that matches your style
There’s a difference between an active and a passive business owner. An active business owner will be involved in the day-to-day management decisions while a passive business owner acts as an investor. Consider the workload you want to take on from the purchase of an accounting business. Are you looking to make the company your own or work a flat 40 hours a week while still enjoying life? Running a business isn’t easy and you want to choose a company that reflects your preferred workload.
The seller also has key considerations before entering into the sale. Selling your accounting practice is a major decision. You want to be sure all your hard work over the years doesn’t go to waste. Consider the following items before you enter into a contract:
Small businesses sell quicker
The smaller your practice is, the faster it will sell compared to a large firm. More clientele comes with a higher purchase price that not all potential buyers can afford. Additionally, small practices are appealing to large firms looking to grow through clientele through acquisitions. If you have created a large practice, be prepared to wait a while to find the right buyer. There are things you can do to make your business more appealing. Contact a business broker for more information.
Selling your business eliminates your say
Running your own business gives you the ability to enforce your own vision, mission, and goals. When you list your accounting business for sale, you lose all control over the way it is run. If internal succession isn’t an option, prepare yourself for a future of your company that you might not like. Many business owners see success with adding clauses that allow the business owner to be somewhat involved over the next few years after the sale is complete; however, the level of involvement is generally up to the buyer.
Focus on client retention leading up to the sale
Client retention is a factor that prospective buyers will analyze before they put in an offer. If your client retention is low, it may raise red flags to investors while a strong retention figure will encourage offers. Most contracts are based on a yearly installment based on client retention. If the firm loses clients, the yearly installment payment will decrease, making it vital to maintain strong retention policies leading up to the sale. Moreover, if your business gains clients, your annual installment payment will rise. Building a strong brand image years before you are looking to sell boosts your installment income down the road.
Timing is everything
Accountants do have a busy season, which generally ranges from November to April. This is where the bulk of the cash flow comes in. The specialties of your business will drive which months retain the highest cash flow. The accounts receivable you currently hold on to the balance sheet influence the sale. There’s no guarantee that these receivables will be collected, presenting a risk to potential buyers. Buyers want to see a steady cash flow right away and not wait for services performed months ago. Take a look at your cash flow to determine when you have collected the most revenue, then consider listing your business.
Whether you are looking to purchase an accounting business for sale or list your own, there is an abundance of considerations that you must go through to create a mutually beneficial contract. You might not know the ins and outs of the business real estate market, making it important to contact an expert that can walk you through the entire process.
Truforte Business Group is a business broker company located in Florida. Our team specializes in the selling of accounting practices, with several of our members being CPAs or former CPAs. Our industry insight might be just what you need to close a deal quickly and efficiently. Reach out today to learn more.
For additional information about accounting business in Florida, the Florida Institute of Certified Public Accounts offers great information and many educational opportunities for learning.
If you are ready to get started with the sale or purchase of an accounting practice, and prefer to work with someone who has an accounting background check out our team here.
For information on legal practice check out the legal practices for sale in Florida.