The business-for-sale market is just as frustrating for buyers as it is for sellers these days. Although there are plenty of entrepreneurs who want to buy an accounting business, capital restrictions are holding them back.
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Market timing is a constantly moving target. Knowledgeable entrepreneurs understand that market timing isn't nearly as important as other factors in a accounting business sale. You just need to know your buyers and structure the deal accordingly.
Every business seller dreams of a fast sale and a fat payday. However, no one told the marketplace about your expectations. The outcome of your sale will be determined by market forces - not by your personal circumstances or desires. Despite your best efforts, you need to prepare yourself for the possibility of receiving less than you expected from the sale of your accounting business. If buyers don't seem to be willing to meet your expectations, consult with your broker to modify your strategy and market approach.
Many sellers don't realize how many prospective buyers there are for their businesses. We frequently see qualified buyers emerge from the seller's network of business and personal acquaintances. In other cases, sellers take a proactive approach to finding likely buyers and contacting them directly. Competitors may seem like natural prospects and they are. The downside is that they won't pay top dollar and will probably absorb your company into their own.
Professional appraisers can use three methods to determine the value ofan accounting business: The income method, the asset method and the market method. While the income method uses anticipated revenues as a value basis, the asset method focuses on the company's capital, real estate and intellectual assets. Finally, the market method determines the worth of your accounting business based on the sales of similar businesses in your geographic area. A good appraiser will often use multiple valuation methods to arrive at a reasonable estimate. Sellers should take note of the fact that all three valuation methods reward businesses that takes steps to increase assets and income.
Given your interest in exit planning and in accounting businesses, you might find these additional resources to be of interest.
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