Deciding to sell your CPA firm can be difficult, emotional, and time-consuming. Before deciding to sell, you should learn the ins and outs of the process and how long it takes to navigate a successful sale. Keep reading to learn how long it takes to sell a CPA firm, the factors influencing the timeline, and more.
Factors That Influence the Timeline
Many factors will determine how quickly a CPA firm can sell. At Private Practice Transitions, the selling process generally takes around 10 months to a year. After closing, the seller will typically stay on for another six months to a year to aid with the ownership transition. All in all, a seller can expect the entire process to last roughly 18 months or longer.
The current state of the economy and the demand for CPA firms play a significant role in determining how long it will take to sell your firm. In times of economic prosperity, buyers are more likely to invest in businesses, while during economic downturns, the process may take longer due to increased caution among potential buyers.
Valuation and Pricing
Determining the right valuation and price for your CPA firm is essential to attracting potential buyers. Businesses priced too high can sit on the market for an extensive period, whereas those priced reasonably tend to sell relatively quickly. Engaging a professional to determine your firm’s value and setting a realistic asking price can make a difference in the timeline.
Preparation and Presentation
The sooner you begin preparing your CPA firm for sale, the faster the process will go. This includes organizing financial records, outlining a clear transition plan, and sprucing up the firm’s appearance. A well-organized and visually appealing firm is more likely to attract buyers and reduce the time it takes to sell.
Another practical consideration for buyers and sellers during a CPA acquisition is the bank and how quickly they approve of the deal and funding. Many buyers require bank funding for CPA acquisitions, which makes both sides beholden to the bank’s process as it negotiates and agrees to terms for the deal and financing.
Key Steps To Expedite the Sales Process
Organize financial records: Having accurate and updated financial documentation readily available for potential buyers is essential. This will speed up due diligence and make your firm more appealing to prospective buyers.
Develop a transition plan: Create a realistic plan that outlines how you will transfer clients, employees, and other aspects of the business to the new owner. Most sellers stay on for at least another six months after the sale to ensure a smooth transition for clients, employees, and the new owners.
Engage professionals: Hire professionals, such as a business broker specializing in CPA firms, to help you with valuation, marketing, and negotiations. This assistance will expedite the sales process and potentially result in a higher sales price.
Let Private Practice Transitions Sell Your CPA Firm Quickly
The time it takes to sell a CPA firm can vary greatly, but now you should have a general impression of how long the process can take. Fortunately, by working diligently to prepare your business for sale and engaging professionals who specialize in CPA firm transitions, you can quicken finding a buyer and completing the transaction.
If you are considering listing your tax practice for sale, Private Practice Transitions can help! Our experts will take you through the process to ensure an expedient and smooth ownership transition.