4 min read

The Importance of Owner Transition When Selling a Business

By Private Practice Transitions on Aug 25, 2022 1:30:01 PM

Selling a business is a big decision that shouldn’t be taken for granted. Once the sale is made, you must go through a phase known as the transition period (or the handover period). During this period, you, as the existing owner, will remain with the business for a specific timeframe to help the new owner take control of it.  

Topics: Selling a Business Business Transition
3 min read

The Implications of Fed’s 50 Basis Points Hike on Interest Rates

By Private Practice Transitions on Jul 13, 2022 12:00:00 PM

The Federal Reserve’s decision to raise interest rates aims at slowing the economy without leading to recession. The increase in interest rate will also help counteract the effects of inflation while scaling back other COVID-19 pandemic-era economic supports. According to Jerome H. Powell, the Fed Chair, the Fed is moving expeditiously to restore price stability for both consumers and business owners.  

Topics: Interest Rates
5 min read

The Changing Landscape of Third-Party Administrators

By Private Practice Transitions on Jun 16, 2022 9:07:27 AM

Dubbed TPA, the Third-Party Administrator is an organization responsible for managing all aspects of your employees’ retirement plans. TPAs design retirement documents in addition to preparing both employee and employer statements.  

Topics: Third-Party Administrators TPAs
7 min read

Deal Structure Explained

By Private Practice Transitions on May 2, 2022 11:00:00 AM

Global mergers and acquisitions in 2021 reached new heights. In fact, the number of deals announced publicly numbered 62,000, representing a 24% increase from the previous year. Cheap credit, high corporate profits, elevated share prices, and private equity cash were just a few of the contributors to the increase in merger and acquisition activity at the tail-end of the pandemic. And we are not done yet. 

Topics: Deal Structure Mergers and Acquisitions
3 min read

What is Due Diligence and What to Expect

By Private Practice Transitions on Apr 4, 2022 11:00:00 AM

When purchasing an established business, it is important to evaluate “all of the things” that pertain to the business. This includes not only the financial details of the business to determine both the valuation and what your return on investment might be, but what risks may be associated with purchasing the business. You may also need to look at key staff members, contracts, and referral sources, among other things. So, what is this process called? Due Diligence. Essentially, think of due diligence as everything you will consider prior to signing a binding contract to purchase a business.

Topics: Due Diligence
7 min read

How Are Physical Therapy Transactions Structured?

By Private Practice Transitions on Mar 2, 2022 11:00:00 AM

Generally speaking, when an investor wishes to acquire a business from its holders, the parties will agree on terms in the form of a purchase and sale agreement. The agreement will outline, among other things, the assets being transferred in an asset sale or the stock/membership interest being transferred if the investor is taking the business “turnkey.” In this way, the question of who owns the enterprise, and its assets, after the transaction has closed should be indisputable. 

Topics: Physical Therapists Physical Therapy Business Transactions Transaction Structures
5 min read

Valuing a Business: A Look at EBITDA

By Private Practice Transitions on Feb 9, 2022 11:30:00 AM

Starting a business is exciting. Running a business is rewarding. But what about exiting a business? While business owners have a deep knowledge of their business and often reap huge rewards, both on a personal and financial level, most owners do not know what to do when they are ready to retire and/or sell the business. Even more, they do not know what their business is worth. To give you an idea of where to start, let's take a look at one of the most valuable tools at your disposal - your company’s EBITDA. 

Topics: Business Owners Selling a Business Business Valuation
6 min read

Valuing a Business: A Look at Seller's Discretionary Earnings (SDE)

By Private Practice Transitions on Nov 8, 2021 1:20:00 PM

If you are in the process of selling or acquiring a small company, you have probably come across the term “Seller's Discretionary Earnings” or SDE. In essence, SDE is the foundation of business valuation for small businesses. It is a crucial concept that enables savvy buyers to gain a deeper understanding of a business’s story.  

Topics: Business Owners Sellers Seller's Discretionary Earnings SDE Selling a Business
4 min read

What Is A Letter Of Intent And What Should Be Included?

By Private Practice Transitions on Oct 1, 2021 12:52:00 PM

 

Topics: Letter of Intent
2 min read

What is Goodwill and How Does One Transition It?

By Justin Farmer on Sep 20, 2021 11:35:00 AM

It is common sense that a business is worth more than its tangible assets, but appraising that extra, invisible value can be tricky. Elements such as reputation, customer base, existing networks, and brand recognition all contribute to the value of a business without ever showing up on the balance sheets. When a business is bought and transitioned, those nebulous, intangible assets are lumped together as something called “goodwill.” And, ironically, goodwill is often one of the largest components involved when calculating a business’s final market value.

Topics: Business Owners CPAs Goodwill
2 min read

CPA Practice for Sale! Tips for a Successful Purchase Process

By Private Practice Transitions on Feb 2, 2021 11:31:00 AM

If you have an accounting business for sale, you are likely concerned about how the sale will proceed and if the sale will ultimately be successful.

The good news is that there are many resources available to ensure the sale is a success and to make the entire process much easier for you. Below are a few helpful tips to keep in mind if you have a CPA practice for sale.

Topics: CPAs Business Brokerage Accounting
2 min read

Buying a Physical Therapy Clinic? How to Compete Against Large Buyers

By Justin Farmer on Oct 26, 2020 2:00:00 AM

Approximately 50% of physical therapy practices are known as “onesies” and “twosies.” This means that the practice is owned and operated by one physical therapist that runs one or two clinics. Although this business structure works very well for the physical therapist who owns the business, it also means the marketplace is fragmented, and many therapists are finding it more difficult to go up against big buyers.

Topics: Buyers Physical Therapists
2 min read

Four Unique Issues When Considering Technology Companies for Sale

By Justin Farmer on Oct 19, 2020 12:59:33 AM

If there is one industry that people can feel fairly safe entering, or starting a business in, it is technology. It is no secret that technology has come a long way in just the past 10 years, and that tech experts are only going to continue the upward trend by inventing new and exciting solutions every day. However, technology companies for sale come with some unique issues and if you do not know how to handle them, you could be setting yourself up for failure. Below are the four most common issues you will likely face when purchasing a tech company.

Topics: Buyers Technology Tech Companies
2 min read

Common Misconceptions When Selling an Accounting Practice

By Tanya Farmer on Oct 7, 2020 2:18:08 AM

Selling an accounting practice is something most business owners do only once. Due to the fact that most accounting practice owners have never embarked on such an experience, knowing what to expect can cause fear and skepticism in moving forward with a transaction. Fear and skepticism, in turn, can hinder the selling process and make it much more difficult to agree on terms. With that in mind, if you are about to sell your practice, below are the most common misconceptions associated with such sales and the truth behind them.

Topics: Business Owners CPAs Sellers Accounting
2 min read

Common Mistakes When Buying a Physical Therapy Practice

By Justin Farmer on Sep 30, 2020 2:12:02 AM

Buying a physical therapy practice can be a lucrative investment. However, regardless of the financial decisions you have made in your life, it is likely going to be stressful. It is easy to make any number of mistakes along the way, and any one of those errors could set you back, both financially and in opening your clinic. Below are the most common mistakes people make when buying a physical therapy clinic, and how to avoid them.

Topics: Buyers Physical Therapists
2 min read

Four Compelling Reasons to Buy an Accounting Firm

By Justin Farmer on Sep 24, 2020 2:00:26 AM

Certified public accountants (CPAs) have two choices when they want to start their own firm. They can start from scratch, purchasing or renting office space, and build their business from the ground up. Or, they can find an existing accounting firm for sale, purchase it, move in, and start running the business. Both options are attractive and hold many benefits for any CPA. However, below are four compelling reasons to buy an accounting firm, rather than start one up on your own.

Topics: Buyers CPAs Accounting
2 min read

The Benefits and Challenges of Starting a CPA Firm

By Justin Farmer on Sep 21, 2020 3:36:24 AM

Certified public accountants have two choices after earning their degree. They can strike it out on their own, or they can find a firm that is looking for qualified CPAs. The thought of starting a CPA firm and being in control of your own business may be too good to pass up, and it is true that this option has many benefits. However, there are also challenges that come with being independent, and it is important to understand what those are before you hang up your own sign.

Topics: Buyers CPAs Accounting
2 min read

Selling An Accounting Practice? Avoid These Pitfalls

By Justin Farmer on Sep 15, 2020 3:44:17 AM

A quick look at the statistics shows just how many accounting practices are going to be for sale in the next few years. In the United States, 10,000 people will be turning 65 every day for approximately the next 20 years. Additionally, approximately 60% of all CPA firm owners are over the age of 50 and therefore are starting to think about retirement and perhaps selling their firms. This means the competition for CPA firms is going to be aggressive in the coming years. Anyone thinking about selling an accounting practice must avoid certain pitfalls to give them the edge and sell their practice faster.

Topics: Business Owners CPAs Sellers
3 min read

How Much is a Physical Therapy Practice Worth? How to Value Your Physical Therapy Practice.

By Tanya Farmer on Jul 29, 2020 7:46:00 AM

Valuing a physical therapy practice is part art, part science, and part math. Generally, the math and science, which we discuss below, is more easily calculated. It is the art – knowing how to sell a business and to whom – where true value is realized. For purposes of this article, we will discuss the valuation of a physical therapy practice where a controlling interest and/or 100% of assets are sold. 

Topics: Business Owners Physical Therapists Sellers
3 min read

The Two Steps to Selling a Physical Therapy Practice

By Justin Farmer on Jul 24, 2020 7:43:00 AM

In speaking to countless business owners, we know that making the decision to sell your business is difficult. In large part, fear of the unknown can create analysis paralysis and, ultimately, lead to inaction. Yes, there is much that goes into selling a physical therapy practice, but with proper planning, and the right team, most of the heavy lifting will be done for you. With that in mind, consider these two main steps now to get the ball rolling: 1) value your business and, 2) identify qualified buyers that will help you realize that value.

Topics: Business Owners Sellers Physical Therapy Business Valuation
2 min read

Two Important Questions When Considering Buying an Accounting Firm

By Tanya Farmer on Jul 6, 2020 9:48:00 AM

As exciting as it is to buy an accounting firm, you will also likely have many questions during the process. You will want to know about the current clients within that firm, the employees and whether you will need additional staff, and how you are going to market your new business. These are all valid questions, and you should ask them at some point in the acquisition process. Before you do, though, there are two important questions you need to ask yourself first.

Topics: Buyers Business Brokerage Accounting
2 min read

How to Keep Clients When Purchasing an Accounting Firm

By Tanya Farmer on Jul 1, 2020 5:00:59 AM

Acquiring and retaining new clients is one of the biggest concerns for any accountant, second only to recruiting and retaining good employees. While client retention is a challenge for all accountants, it is of particular concern when purchasing an accounting firm. To ensure that you retain all, or at least most, of the current clients, follow the four tips below.

Topics: Buyers Business Brokerage Accounting Client Retention
3 min read

What Is My Business Worth?

By Justin Farmer on Apr 23, 2020 7:40:23 AM

 

 

Topics: Business Owners Sellers
2 min read

The Paperwork You Need When You Sell a Law Practice

By Justin Farmer on Apr 20, 2020 2:04:00 AM

For years lawyers could not sell their law practices because it was considered unethical. The prevailing theory behind deeming the sale of a law practice unethical was tied, in large part, to the client’s right to choose a lawyer and, in practicality, generally left single-owner firms with an asset they could not sell (while large firms were merging, acquiring books of business, etc.). Today, however, it is both ethical and common to sell a law practice, but the structure of the transfer of your law practice, and, thus, the documents you prepare must take the ethical rules into account. Below are some of the most important documents to have on hand once you decide to start the process of transferring your firm to a new owner.

Topics: Business Owners Lawyers Sellers Legal
3 min read

Should You Buy an Accounting Firm or Start Your Own?

By Justin Farmer on Apr 13, 2020 1:54:27 AM

The prospect of owning your own accounting firm is an exciting one, but it also comes with a dilemma for CPAs. You have two options: You can either venture out on your own and build an accounting firm from the ground up, or you can buy an accounting firm that is already up-and-running. When making this decision it is important to weigh the pros and cons. Below, you’ll find a list of pros and cons when it comes to starting your own accounting firm.

Topics: Buyers CPAs Accounting
4 min read

When Is the Right Time to Sell My Business?

By Justin Farmer on Mar 30, 2020 4:14:45 AM

 

One of the most common questions we get from clients or potential clients is: When is it the right time to sell my business? Before I can answer that question, I need more information from you. There are three questions I have for my clients in return:

1. How much longer do you want to work?

Topics: Business Owners Sellers
3 min read

Five Things to Look for in an Accounting Business for Sale

By Justin Farmer on Mar 24, 2020 4:11:13 AM

When making any type of business acquisition, there is much to consider, and that is certainly true when acquiring an accounting practice. Many people do not know where to start looking for an accounting practice for sale, and searching the local classifieds is not always enough. Websites such as BizQuest, BizBuySell, and PrivatePracticeTransitions.com are a great place to start. Once you find an accounting practice for sale that you think may be a good fit, you then want to make sure that it has the five essentials listed below.

Topics: Buyers CPAs Accounting
2 min read

Want to Buy a Law Firm? Read This First

By Tanya Farmer on Mar 17, 2020 4:08:56 AM

Whether you are venturing out on your own and plan to start your own law firm, or your current firm is expanding, you may be thinking it is time to buy a law firm. Buying a law firm is a bold move and one of the biggest decisions you will make in your career, so it is important to first consider a few important factors. Below are some things to keep in mind when it is time to start searching for a law firm for sale.

Topics: Buyers Business Owners Lawyers Legal
2 min read

How to Know if a Professional Business Broker is Right for You

By Justin Farmer on Feb 27, 2020 11:20:55 PM

You may already know that when selling your business, business brokerage firms can be quite helpful. Experienced business brokerage firms will screen qualified buyers and help you through the many obstacles you may encounter when trying to complete your sale. In the meantime, you can remain focused on running your business before the sale is final.

Topics: Sellers Business Brokerage
2 min read

Steps for Buying a CPA Firm

By Justin Farmer on Dec 18, 2019 5:46:12 AM

There are many reasons you may want to buy a CPA firm. One of the main reasons many CPAs buy an existing firm is simple: purchasing an accounting firm that is already up and running is much easier than starting one from scratch. Buying an existing firm, along with existing operations, also minimizes the risk associated with starting a business because the firm will (a) have existing clients (and therefore work in progress and accounts receivable), (b) have an existing space and infrastructure in place (phones, email, server, filing systems, and the like) and, last but certainly not least (c) have existing staff members. These are just a few of the most critical aspects of any accounting firm and, when combined, create an opportunity that simply is a safer bet than starting from scratch.

Topics: Buyers CPAs Accounting
2 min read

Succession Versus Sale

By Tanya Farmer on Dec 12, 2019 5:40:23 AM

In the most recent issue of the Oregon State Bar Bulletin, Lee Wachocki provides a great strategic insight into the option of choosing a successor rather than selling your practice. Our very own Justin D. Farmer contributed to the article, titled “Sales Isn’t The Only Option.” You can read the full piece by clicking here. Following is our own synopsis and comments:

Topics: Sellers Consulting Services Business Succession
2 min read

Why do I Need a Business Broker to Buy a Company?

By Justin Farmer on Dec 6, 2019 4:11:05 AM

Purchasing a business is a huge investment. It is definitely not something that can be done on a whim, or without the necessary experience and knowledge backing up the purchase. There are many things you must take into consideration when buying a business, and this is why so many buyers choose to work with a business broker before the sale is final. Business brokers bring many benefits to individuals who are looking for a company to purchase, including those listed below.

Topics: Business Brokerage
3 min read

How to Determine What My Law Firm is Worth

By Tanya Farmer on Nov 27, 2019 2:31:40 AM

You have worked hard and built your law firm into something that you are immensely proud of and that you value a lot. When it comes time to sell your firm, however, it is not the value you place on it that matters. You need to determine how valuable potential buyers will find your firm because that is what you will ultimately receive for it. While you may think it is going to be difficult to ignore your own emotions when evaluating your law firm, there are a few factors you can use to help you step back and really see how much your firm is worth. 

Topics: Lawyers Sellers Consulting Services Legal
3 min read

How to Buy a Law Practice

By Justin Farmer on Nov 8, 2019 5:09:10 AM

Whether you have started a law practice and are looking to expand rapidly, or are thinking about leaving a large firm and venturing out on your own, buying a law practice – buying a business – may be right for you. Regardless of where you are in your career, it is much easier (and more cost-effective) to buy a law practice than it is to start one all on your own. Many attorneys do not even consider purchasing a law practice because they don’t realize they can, and/or they don’t know where to even start with the process. However, buying a law practice is both possible and a great avenue to pursue, for the savvy business person. Below are a few things to consider if you are thinking about starting your own practice.

Topics: Lawyers Consulting Services Legal
4 min read

How to Sell an Accounting Practice for Top Dollar

By Tanya Farmer on Oct 25, 2019 2:05:00 AM

Baby Boomers are retiring en masse across all industries. And while the majority of accounting firm owners are baby boomers who are near the age of retirement (65 or older), just as many younger professionals are coming of age and seek to run their own businesses. For the former group, whether you want to retire, semi-retire (perhaps you just want the freedom to travel without firm administration hanging over your head), transitioning the ownership of your firm should be high on your list of priorities. If you are asking, “How can I sell my accounting practice and get top dollar?” you will want to consider the tips below. 

Topics: Business Owners CPAs Sellers Consulting Services Accounting
1 min read

Justin Farmer Named to South Sound Business 40 Under 40 Class of 2018

By Tanya Farmer on Nov 5, 2018 12:06:27 PM

TACOMA, Wash. (Oct. 3, 2018) – Justin D. Farmer, 36, Founder and President of Private Practice Transitions, Inc., a Gig Harbor-based professional business brokerage, has been named to South Sound Business magazine’s 40 Under 40 list for 2018.

Topics: press release staff PPT News
3 min read

What is Your Business Worth? 6 Rules of Thumb to Consider

By Justin Farmer on Nov 22, 2016 1:20:25 AM

I work with extremely successful and exceptionally bright professionals who, after years of hard work, have grown a business that has going concern. But like most savvy business owners, my clients come to realize that it is time to transition and “pass the baton”, so to speak, to a younger professional who can carry the business into the next generation. But selling a business is a lot of work. And certainly selling a professional service business must be harder (or so many of my clients think). Then the question remains: is it worth it? The short answer: absolutely. Sure, there are countless moving parts and factors to consider when selling a business. But with the proper planning and team in place, you can maximize your return on investment.

Topics: Business Owners Blog Sellers Consulting Services
2 min read

SBA Loan Programs – An Introduction

By Tanya Farmer on Nov 14, 2015 7:03:44 AM

As we have established thus far, the U.S. Small Business Administration (SBA) is designed to help you get the funding you need to start, purchase or expand your small business. Though the SBA does not lend money directly, it does back and supervise the lending process, removing much of the uncertainty for both lenders and applicants alike. This article provides a brief overview of each of the SBA’s four main loan programs. I will be discussing each loan program in more detail at a later date.

Topics: Buyers Business Owners Consulting Services Small Business Administration
2 min read

What is the Small Business Administration (SBA)?

By Justin Farmer on Jul 10, 2015 8:20:49 AM

As my first article on the Small Business Administration “Buying a Business is Easy: 5 Steps to Secure SBA Financing” received so much attention, it seems prudent to continue delving into this topic. This will therefore be the first in a small series on just that. Stay tuned.

Topics: Buyers Business Owners Small Business Administration
2 min read

Networking Made Easy – Part Two: The Strategy

By Justin Farmer on Jun 17, 2015 1:10:52 AM

Part one: Networking Made Easy – Part One: Expanding Horizons

Topics: Buyers Networking
3 min read

Networking Made Easy – Part One: Expanding Horizons

By Justin Farmer on May 19, 2015 12:38:44 AM

Part Two: Networking Made Easy – Part Two: The Strategy

Topics: Buyers Networking
2 min read

Buying a Business is Easy: 5 Steps to Secure SBA Financing

By Justin Farmer on Apr 21, 2015 2:40:21 PM

One of the most daunting aspects of striking out on your own is the inherent financial insecurity. You are exchanging constraint and stability for freedom and risk. Hesitance is normal, but it should not stop you from chasing your independence, especially when there are government agencies designed to help. One of these is the government-backed U.S. Small Business Administration or SBA. The SBA’s business financing programs “[provide] small business with an array of financing…from the smallest needs in microlending – to substantial debt and equity investment capital.” The most common SBA small business loan allotment is about $130,000-140,000. Yet they range from just $5,000 to $5,000,000.

Topics: Buyers SBA Loans SBA Financing
2 min read

The Affordable Care Act & Why We Still Need Private Care

By Justin Farmer on Apr 8, 2015 2:01:50 PM

It’s no secret that the Affordable Care Act (ACA) can be a nasty minefield for doctors in private practice to navigate. In the attempt to universalize healthcare and reduce costs generated by the ACA, the federal government incentivized physician clumping. Hospitals, Affordable Care Organizations (ACO’s), and private networks can more easily offset the accruing losses, pad that 90-day no-pay grace period, and afford the mandatory conversion to electronic medical records. So why, oh why would a physician want to remain in private care?

Topics: Business Owners Private Care Private Practices Affordable Care
2 min read

Closing the Loop with Private Practice Transitions

By Justin Farmer on Mar 9, 2015 3:47:06 PM

The US currently faces a unique generational gap in its workforce.  This gap causes office discord, managerial nightmares, and networking problems, as two very different age demographics are forced to make nice with little guidance as to how.

Topics: Business Owners Business Brokerage Private Practice Transitions
2 min read

7 Ways to Prepare for the Transition of Your Business

By Justin Farmer on Feb 24, 2015 1:02:09 PM

Congratulations, you’ve made the decision to sell your business. You’re ready for the transition. But you have more questions than answers regarding how to begin? Like many small business owners, you’re probably feeling overwhelmed by the sheer volume of the task before you. Do you hire a consultant? Organize your books? Notify your employees and clients? What comes first? The questions can seem endless. But while getting started can be the hardest part of the process, it certainly doesn’t have to be.

Topics: Business Owners Sellers Consulting Services Business Transition
2 min read

Justin Farmer Launches Private Practice Transitions

By Justin Farmer on Jan 25, 2015 11:27:08 AM

Noted Seattle Attorney and Legal Business Executive Now Providing Brokerage Services

Topics: press release Business Brokerage Consulting Services Private Practice Transitions
2 min read

6 Reasons Why Your Private Practice Is Worth More Than You Think

By Justin Farmer on Jan 23, 2015 4:00:27 AM

If you’re thinking of selling your private practice, one of your primary concerns likely has to do with its value. How much is your practice worth? What can you really make by selling it? And is that monetary gain going to outweigh the hassle? You’ve heard the horror stories about failed negotiations, missing paperwork, and flaky buyers. So before you start your valuation or just quietly pack your things, consider these six, often overlooked reasons why your business is worth more than you think.

Topics: Business Owners Sellers Private Practices