Talking to a business contact recently we both shared stories of accountants who are looking to retire and sell their accountancy practice. One of the problems that my friend found is that ‘mature’ partners of firms could not find younger accountants to take on their practice because they were stuck in their old ways and processes and can only offer the quality service of accounts preparation at the year end with tax advice. They are now hoping to sell their client ‘list’ on to a firm who are looking to expand and take on more clients.
From my side, I found similar situations but explained how I mentioned to the firm involved that they would need to bring their firm into a more modern way of practising for their clients. I received the same old excuse ‘but that’s the way we have always done it’ which always leaves me with my head in my hands. My response – do you let your clients say that when they have a downturn in profits and sales?
10-20 years ago accountants were always managing to sell their lists/firms for a great value because clients were loyal in a different way and as long as they received their accounts and tax return in a timely manner then they stayed. BUT, in the 21st Century, clients are needing to update their business model and in turn require the same from their professional advisers. The cloud is making business more efficient and more transparent so the client needs indicators that their business is keeping up with their competitors who have taken the modern business world on board.
Pro-active accountants who work in the cloud are not just the compliance services from old school accountants, they can offer KPI’s with real-time data and in a time period which helps the client keep in touch with competition. I enjoy seeing the live data and reviewing the indicators vital to my clients.
Back to the firm, alas they have not changed anything in their processes or services and they are still looking for ‘exit’ strategies. I believe they are hoping a larger firm will come and offer them a decent amount of money for their client list, but if a client gets an inclination that their accountant is looking to retire I wonder how long they will stay loyal. Which in turn will reduce the amount of money they will hope to receive.