Would You Buy Your Own Accounting or Bookkeeping Firm?

If you were looking to buy an accounting or bookkeeping business, and someone put your own firm in front of you, would you buy it?

It’s an interesting question.

Most owners spend their time running their business, looking after clients and managing their staff. They don’t often get the opportunity to step back and look at their business through the eyes of a potential Buyer.

But that’s exactly what a Buyer does.

They aren’t emotionally invested in the business. They are looking at what they are buying, what opportunities it presents and whether it fits with what they are trying to achieve.

What Would You See?

If you were looking at your own business as a potential Buyer, what would stand out?

Would you see a strong client base? An experienced team? Good systems? Opportunities for growth?

Or would you immediately notice areas that could make the business more difficult to acquire?

The reality is that every business has strengths and weaknesses. What matters is how those characteristics are viewed by a potential Buyer.

Buyers Aren’t Just Buying Your Profit

Profitability is obviously important.

A Buyer wants to see that an Accounting or bookkeeping business is profitable and financially sound.

But Buyers aren’t actually buying profits. They are buying the business that produces those profits.

That can include:

• Clients – the relationships and recurring revenue built up over many years.
• Staff – experienced people who understand the clients and know how the business operates.
• Systems – the processes, technology and infrastructure supporting the business.
• Intellectual property – the knowledge, processes, brand and other assets developed within the business.
• Future opportunity – the potential for the Buyer to grow and develop what they acquire.

Would a Buyer See the Same Opportunities You Do?

It is not unusual for an accounting or bookkeeping firm to reach a point where the owner is happy with the size of the business.

They may have stopped actively pursuing growth because taking on more clients means more work, more staff and more management responsibility. Some owners have even reached the point where they are turning away new work because they simply don’t want to make the business any bigger.

A Buyer may look at exactly the same situation very differently.

For a Buyer who is actively looking to grow, those additional clients may be exactly what they want. They may have the resources, staff and infrastructure to take on more work and grow the practice without the owner having to do any more work.

The business that has reached its natural limit for one owner may therefore represent an excellent growth opportunity for another.

One Buyer May See More Value Than Another

Not every Buyer is looking for the same thing.

An Accounting firm looking to expand into a particular geographic area may see considerable value in a practice with an established client base in that location.

Another Buyer may be more interested in the firm’s specialist clients or the skills of its team.

A Buyer who is actively looking for growth may see significant potential in a business where the existing owner has deliberately chosen not to pursue further growth.

This is why finding the right Buyer is so important.

What About Smaller Bookkeeping Businesses?

The same principle applies to bookkeeping businesses.

A bookkeeping practice with a relatively small turnover may not initially appear to be a significant acquisition. But a Buyer with the right infrastructure and resources may see a group of quality clients, an experienced team and an opportunity to expand without having to build those relationships from scratch.

This is why we are seeing genuine interest in smaller bookkeeping businesses from Buyers looking to grow through acquisition.

If you’re a Bookkeeper wondering whether your business may be attractive to a Buyer, see our previous article, Can I Sell My Bookkeeping Business?

How Abacus Business Advisors Can Help

At Abacus Business Advisors, we work with both Buyers and Sellers of accounting and bookkeeping businesses. This means we see transactions from both sides and understand what makes an opportunity attractive to different Buyers.

Interestingly, we regularly receive feedback from Buyers that our communication, responsiveness and understanding of what they were looking for made them feel very well supported throughout the process.

We believe that comes from understanding that a successful transaction needs to work for both parties. Buyers need to feel confident in the opportunity and comfortable throughout the process.

Final Thoughts

---

“Know what you own, and know why you own it.”

— Peter Lynch

---

When you’ve spent years building an accounting or bookkeeping business, it’s easy to see it through the eyes of an owner.

But if you were the Buyer, would you buy it?

That may be a difficult question to answer—but it could be one of the most valuable questions you ask yourself before deciding to sell.

If you’re considering selling your Accounting or bookkeeping business, or you’re interested in acquiring one, contact Abacus Business Advisors for a confidential discussion.