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20 Dec, 2013
Georgia

Mergers & Acquisitions

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Listing Number : NC1093 
Location : Near Asheville 
Annual Gross : $227,000 
Asking Price : $240,000 
Status : New 

Mergers & Acquisitions


Heard horror stories about a merger or acquisition that went wrong? Maybe spending a little extra and hiring some help with the process is a good idea. Here are some questions a CPA could ask a potential representative or broker:

Should I consider giving a retention guarantee when selling my practice?
While there might be good reasons for selling for a fixed price, a seasoned broker will know that a fixed price is only possible in highly competitive circumstances. In my opinion, if you’re set on selling for a fixed price, you’re significantly limiting your buyer pool. Most buyers, including some that may be the best buyer for your practice, will not consider purchasing a practice without some type of revenue guarantee.

What is your closings to listings ratio?

Not even the best broker will have more than an 80 percent success in selling all of their listings, but it should be greater than 50 percent. Some brokers will list 50 or more practices for sale in a given year, but sell fewer than 25. Another broker may take 40, but sell 30. Remember: it’s not the number of listings that’s important, but the number of sales.
Are CPA firms the only or primary type of business you sell?
Some brokers sell many types of business, including dental, chiropractic or other professional services. Accounting firms are unique enough to require a specialist to offer the necessary services.

How do you educate the buyers and sellers in the process of selling a practice?

Most qualified brokers will have resources specially designed to educate clients, including books, reports, contracts and seminars. 
Do you have staff?
Most high-quality practice brokers have a staff dedicated to marketing and servicing its clients. It would be very difficult for a single individual to offer the quality of service necessary to compete in today’s market.
What is your experience? Are you a member of a trade association? Do you hold any accreditations?
While being a CPA is not required for being a CPA practice broker, qualified brokers should have extensive background in business and be an active member of several trade associations.

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List of Articles

Georgia Mergers & Acquisitions file

  • Dec 20, 2013

Mergers & Acquisitions Heard horror stories about a merger or acquisition that went wrong? Maybe spending a little extra and hiring some help with the process is a good idea. Here are some questions a CPA could ask a potential representa...

Alabama Buying, Selling a Practice? test file

  • Dec 20, 2013

California CPA magazine: March/April 2008 At some point in their careers—if not at many points—a CPA’s thoughts turn to the future as they attempt to answer questions about their practice. An aging firm without a successor might look to be a...

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