Selling your practice or acquiring a practice is not your normal day to day activity. It is an emotional process because there is inherent risk and because it is either the end of successful stage of your life or the beginning of a new chapter that you expect will lead to future success. It is also likely a new experience or at best, if you have acquired before, one you have engaged in only a few times prior. So it is an unusual and unfamiliar venture which only heightens the impact of emotions.
For the seller the emotions derive from several areas:
- The pride and ego every successful business owner should have in building a successful business that has made the life they have possible and the desire to see the legacy of that effort continue to be successful.
- The concern for clients, many of whom have probably become almost friends and family members, and a fear of whether or not they will be taken care of after the seller leaves.
- The concern for staff and the uncertainty of whether the buyer will mesh well with them and be a good boss.
- The financial risk tied to any seller financing or potential adjustment to price based on the buyer’s success.
- The emotion that comes with any significant change in our lives and uncertainty of what comes next.
- And the fact that not all aspects of a sale are within the seller’s control whether that be reliance on the buyer, key advisors, or third party lenders, all of which can try one’s patience.
For the buyer the emotions are also from several sources:
- The reliance that the practice is what has been presented and will fuel their goals and dreams
- The fear that the acquisition will not be successful and they will lose money
- The financial risk tied to bank or seller financing if the acquisition is not successful and the burden this would put on their lives and families
- The fact that not all things about the practice they are acquiring are known. Fit with clients, staff, and service among other things are impossible to fully know until the business transfers
- And the fact that not all aspects of a sale are within the buyer’s control whether that be reliance on the seller, key advisors, or third party lenders, all of which can try one’s patience.
Our recommendation to sellers and buyers is to go into a transaction with your eyes wide open about the emotions you are going to experience, bring in objective advisors to help limit any negative impact emotions could have, and get through the process with some urgency so you and the other party can get back to focusing on what you are great at and passionate about… providing outstanding service to your clients!
ProHorizons is a West Coast brokerage and consulting company focused on tax and accounting practice sales and acquisition services.
If you are planning to sell your practice and would like more information about our service, please visit our Sell Your Practice page and/or Request a Sales Information Page. If you are looking to acquire a practice, please visit our Buy an Accounting Practice page, see if there is a practice of interest in our Current Listings in the Pacific Region, and/or Register with us as a Buyer.