Sell your practice without closing the ledgersby
So you want to sell your practice but you don’t want to retire. Norman Younger weighs up your options.
After a barnstorming year for many practices due to the unprecedented levels of client support required due to the pandemic, 2021 has surprisingly started off with a marked increase in accountants wanting to retire.
In truth, many say that they want to retire from running a practice but are not ready to close their ledgers for good, either because they cannot afford to or because beancounting runs through them like a stick of Blackpool rock.
So, what are the options for the burnt-out baby-boomer accountant who doesn’t fancy a life on the golf course?
Let’s examine five routes to retirement while ‘keeping your hand in’.
Sell the whole practice
A popular option is to sell the entire practice but continue working for the buyer full time or part time with a view to reducing the hours as time goes on.
Buyers tend to like this as the continuity mitigates any concerns clients may have about the new incumbent and allows the buyer to remain focused on their existing operation.
2. Gradual exit
Selling chunks of fees over a period of time will reduce the stress of having a larger practice, but there remains the issue of which ones to keep and which to jettison.
But it suffers from the drawback of tying you up with the sales process more than once, and in the early stages may well keep you running your practice at a level you would rather not be doing.
3. Consultancy route
Sell everything and undertaking consultancy is another option, especially if you have niche skills that are in demand.
The fly in the ointment here is that you may well have to start fresh marketing to go hunting for clients and that can take time, expense and a lot of effort to promote yourself.
4. Virtual FD
Stepping into a business as a virtual FD has become more common in recent years, as companies get a qualified accountant part-time at a fraction of the cost of a full-time employee. Many accountants work for three or more businesses and split their time according to demand but there is no reason why you cannot take on a single company one day a week or several days a month.
5. Lifestyle practice
How about the much vaunted “lifestyle practice”, working when you want and as much as you want? This could be the best way in the era of creeping and ever complex regulation - working smart, with a lean operation and focusing on certain types of client or advisory services.
By setting a strict limit on how hard you wish to work you can survive and thrive on a small cohort of niche clients that are lucrative but don’t come with the stress of running a practice. You can create a waiting list for your services if your reputation precedes you, if for example you are taking on ad hoc assignments such as business reports, management accounts or tax work.
Accountants in the twilight of their careers have never had such a choice. The question is simply which option to choose.