Purchasing blocks of fees

Purchasing blocks of fees

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I am thinking of expanding my business and purchasing a block of fees. However I am bit green in this area.

What are the questions that I need to ask any potential seller ? how should the purchase be arranged .e.g. 50% up front then 25% per annum for two years? Is it ok to include a clawback for any loss of clients following purchase ? I have read that accountancy businesses are worth 1.0 to 1.25 of gross recurring fees. Is this still applicable ? Has anyone had experience of buying or selling a block of fees?

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By Steve McQueen
23rd Sep 2011 11:20

This area is a vast mine field and a subject in its own right...

I have bought 6 times and sold once.

 

Two the the purchases were rubbish (but small so it wasn't the end of the world)

 

One of the purchases was fantastic

 

The sale nearly distroyed me and is still being fought 3 years after completion of contracts.

 

I have no connect to him but would recomend Julian Hamilton from Jobtel (http://www.jobtelmanda.co.uk/) without any hesitation as a specialist in this field who will guide you through the whole process.

 

Best of luck

 

Steve

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By Moonbeam
23rd Sep 2011 14:25

Heard from experienced Practitioner....

The big boys when buying blocks of fees assume most of them will be unattractive and claw back for a large percentage of the initial agreement. So that is why this area needs to be negotiated with the utmost care for both sides.

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