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Turnover per partner

Rule of thumb for accountancy practices

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Is there a target turnover per partner in practice or are there any stats on average fee base per client for SME practices?

Would be interested to know everyones thoughts on this?

I know this data is available for the larger practices but not sure about the smaller ones?

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By Mr_awol
21st Jul 2020 17:18

I doubt there is an average - too many variables, particularly how much admin time they each suffer (some firms may dish it out evenly, others have one who sacrifices their billables to take care of all the internal compliance, staffing, etc). I've seen partner chargeable time range from 5% to 60%

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By SA2016
21st Jul 2020 17:21

Thanks, to clarify I was wondering if there was a target turnover for each partner portfolio. e.g. £1m per partner which seems reasonable?

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Replying to SA2016:
By johngroganjga
21st Jul 2020 19:12

It must depend a lot on how each firm is structured - in particular the gradient of the sides of the pyramid. A partner who is very hands on will not be able to manage as big a portfolio as one with a team to deal with all the detail for them.

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Replying to SA2016:
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By Mr_awol
21st Jul 2020 23:18

£1m per partner might seem reasonable in the bigger/city firms but is way over the top for the smaller firms, which you asked about.

A firm we looked at buying recently has four partners and about 15 staff. Total turnover for the entire office was less than £1.5m so by your expectation they’re miles away. Actually it’s quite a good practice.

I’m not sure what you are actually asking, or why. Maybe if you explained the reasoning behind the question (and the level of firm you’re thinking of) then you might get better answers.

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Replying to Mr_awol:
Lone Wolf
By Lone_Wolf
22nd Jul 2020 11:03

Mr_awol wrote:

A firm we looked at buying recently has four partners and about 15 staff. Total turnover for the entire office was less than £1.5m so by your expectation they’re miles away. Actually it’s quite a good practice.


Clearly they're not selling enough cash flows.
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Replying to Lone_Wolf:
Hallerud at Easter
By DJKL
22nd Jul 2020 11:10

Or not reaching their target for sales of cashflows within their own cashflows.

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Replying to DJKL:
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By Mr_awol
22nd Jul 2020 13:57

I just did a 10 minute cashflow for my practice and it has enabled me to identify that if I increase my personal fees to £1m I will make more money.

Also if I recover bad debts, instead of writing them off, I will make even more money.

Who'd have thought that be increasing sales and collecting the proceeds, I'd be able to build a better business? I've now changed the £1m from pa to per month and, based on my cashflow prediction, I'm off to buy a Ferrari.

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Replying to Mr_awol:
Hallerud at Easter
By DJKL
22nd Jul 2020 12:36

You say that and I grin, but it is a nervous grin.

Over the years I have been required to review business plans prepared by/for prospective tenants, whilst your comments are exaggeration they sadly hold a kernel of truth.

Edit- The episode each year in The Apprentice when the candidate business plans get reviewed is always my favourite bit of the show, provided you do not mind seeing lions devouring shocked gazelles.

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Hallerud at Easter
By DJKL
22nd Jul 2020 10:20

Staff structure, and their quality, is key to the measurement, accordingly one size cannot fit all- if the staff do a lot of the grunt work but the partner is involved in the preparation of the actual accounts/returns, then likely not that much turnover per partner, if on the other hand the managers take/supervise the work to conclusion with only high end questions for the partner to consider (in my experience generally only arises much re audit) then fees per partner can be quite high.

In effect is the partner a hands on accountant or an administrator with others doing the work

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