A. Often the practices that we list qualify for Small Business Administration (SBA) Loans or for conventional financing. It is true that many local banks will not lend on professional practices but we are in contact with banks that have the resources and the experience. The practice itself must exhibit strong cash flow and the buyer must qualify based on experience, credit history and other factors. Outside financing in the right situation can be better for both the seller and the buyer.
A. The SBA and conventional banks often require a down payment from 10-25%, depending on circumstances. Sometimes no down payment is required. If the seller finances the purchases, he or she would generally require a down payment to insure the buyer's commitment and give him or her more assurance of being paid. (More: Financing Accounting Practices)
A. When the practice itself does not qualify for SBA or conventional bank financing, the sellers are generally willing to carry a note for a part of the purchase price. Such notes are typically for 2-5 years at an agreed upon rate of interest. The assurances the seller is looking for would be a good credit history, a sufficient down payment, significant other assets and buyer experience.
A. Employees: Retaining the employees of the practice is very important to the success of the buyer. It is also critical that the employees not enter into competition with the buyer after the purchase. Carefully assess the possibility of their leaving the practice and taking clients with them.
A. Large Clients: Our model for transition is based on a belief that if a buyer does his job in selling himself to the clients he should be able to retain most of the clients. A special risk, however, exists if one client represents an abnormally large share of the practice revenues. We recommend looking carefully at the 10 largest revenue producing clients from the prior year.
A. Buyer Apathy: Immediately after closing the purchase of a practice, a buyer should market himself to all the clients as if they were new prospective clients. If the buyer does his job, he should retain the vast majority of the clients. Failure to do so can risk loss of clients. (More: Know Your Risks)
A. Sellers represented by Accounting Practice Sales generally will not bear the risk of client retention. At Accounting Practice Sales, we believe that buyers have control over client satisfaction and that practices should not be sold under any type of "seller guarantee" or pricing formula that is based on the buyer's success unless that is the sellers wish. (More: Who Should Bear the Risk of Client Retention?)
A. We highly recommend using SBA sources that have experience in business acquisition financing and specifically with accounting practice acquisitions. We have relationships with such experienced lenders and can walk you through this process. Our lenders can, in many situations, give verbal approval within five days of making applications and can close within one month.
A. We're the largest practice broker in the nation with more dedicated brokers to give you individual attention in your area.
A. We market your practice nationally and expose it to every possible buyer.
A. We have highly qualified pre-registered buyers.
A. We sell the many of our listings for all cash at close.
A. The best chance of your getting a qualified buyer who will meet your price and terms will be obtained by bringing many buyers to the table rather than just one or two. We market in every way possible to find many potential, interested buyers for your practice.
A. We assist in every step of the way from helping to set an asking price for your practice, negotiate with buyers and obtaining financing.
A. We believe it began with the fact that our founders are CPAs who owned practices themselves for years and understand the business from the inside. Their model for practice sales is that the seller should not take the risk of client transition and should seek a deal that is all cash or cash equivalent. In addition Accounting Practice Sales markets in every conceivable fashion to get your practice sold.
A. Do you want to know what you could sell your practice for or what we can sell your practice for? We believe you will likely net more by letting us do the work. It has been demonstrated that a competitive bidding environment almost always increases prices
A. Accounting Practice Sales advertises in most national CPA, EA, CGA, CA, accounting and tax media. We advertise in state and local society journals and websites. In addition we specifically market your practice by direct mail and telemarketing. The key to getting the best price and terms is to bring as many buyers as possible to the table.
A. Accounting Practice Sales is very conscious of your needs with regard to confidentiality. In general we market your practice in a way that maintains your confidentially and guards your identity until a buyer is found who is both qualified to purchase your practice and has a desire to do so. We will consult with you regarding special needs in the area of confidentiality and structure a program that meets these needs.
A. We can assist with the purchase contracts and paperwork, financing, escrow, sample letters to clients, you name it. We'll make certain the transfer is done properly. Now, is this person going to pay you all cash?
A. Finding the right buyer is not just a matter of finding someone willing to meet your price and terms. We understand the need for finding buyers who have sufficient experience and demeanor to treat your clients and employees as you would. The best way to insure you find a buyer you are comfortable with is to bring a multiple of qualified buyers to the table.
A. We think in terms of three months although it varies depending on time of year. Our goal is to introduce you to several qualified buyers within a couple of weeks of beginning the process. In many cases, because we already have thousands of buyers registered, we can introduce you immediately to persons interested in your practice.
A. The vast majority of our practices are sold to individuals that retain the existing location. In most cases, the buyer of your practice will want to retain your space either through lease or purchase. If this is a requirement either because you own the building or have a long term lease, we can qualify buyers with regard to their ability and willingness to keep the same space.
A. Sellers typically stay for two reasons: a. They need the money or b. They think staying will help with client retention. The time can vary depending primarily on what the seller and buyer both want. It does not take 2-3 years to do a good transition as some suppose. We like to see the seller stay a few weeks for the initial transition and notification of clients. Following that the seller needs to be available for about a year to answer questions from the buyer and to encourage the clients to use the buyer. It is common, but not always necessary, to have the seller work full- or part-time through the first tax season. Of course, the seller needs to be fairly compensated for any work done past the first few initial weeks.