Why Should I Buy an Accounting Practice Instead of Building?

Naab Consulting2021-04-19T14:39:47+00:00April 19th, 2021|

What are the standard market conditions for CPA and accounting practices for sale in my area?

Naab Consulting2021-02-01T20:41:26+00:00February 1st, 2021|

Does Naab Consulting provide assistance in financing accounting practice sales?

Naab Consulting2021-02-01T20:41:17+00:00February 1st, 2021|

What is the average profit margin for an accounting practice?

Naab Consulting2021-02-01T20:41:08+00:00February 1st, 2021|

If I am looking to buy an accounting practice, will a down payment be required?

Naab Consulting2021-02-01T20:40:58+00:00February 1st, 2021|

Why do people sell their accounting firm?

Naab Consulting2021-02-01T20:40:38+00:00February 1st, 2021|

Let Us Handle The Sales Process

Q: Why Should I Buy an Accounting Practice Instead of Building?

There are various reasons why it makes more sense to buy a practice as opposed to trying to grow organically. Specifically: Actual client history, revenues, and results rather then projections and hope. Established and trained clients and referral sources. Trained staff. Assistance and training by seller. Opportunity for an additional revenue stream should you offer services the previous owner didn't. Existing office space and equipment so you are ready to work and bill on day 1. If you already own a firm, significant bottom-line contribution due to the economies of scale.

Q: What are the standard market conditions for CPA and accounting practices for sale in my area?

Currently, accounting practices for sale through Naab Consulting are based on a multiple of gross billings with a client retention clause. The client retention clause helps to ensure a fair deal for both the buyer and the seller. Current market conditions and our experience help to set the proper asking price and terms for selling your tax practice. Practices values vary across the country so please contact us directly to discuss your area.

Q: Does Naab Consulting provide assistance in financing accounting practice sales?

Yes, we do! When you are purchasing an accounting firm, take advantage of lenders we use throughout the U.S. who can lend up to 100% of the purchase price. This means that a buyer can purchase a CPA practice using the business’ cash flow.

Q: What is the average profit margin for an accounting practice?

Each practice is different and will yield a different net income, but that said, most practices should have a profit margin of at least 40%. The higher the profit margin, the higher buyer activity a seller can expect to achieve when trying to sell their practice. This is a key component buyers will review when looking at different practices.

Q: If I am looking to buy an accounting practice, will a down payment be required?

Yes. If you are looking at putting cash down, the seller will require a down payment at closing. This helps the seller know that you are committed to this purchase. We trust you can appreciate this from the sellers perspective. If you are looking at outside bank financing, most lenders will require at least a 10%-20% cash injection depending on the size of the loan, cash flow of the practice, buyer's credit history and a variety of other factors. Most lenders will also loan money for additional working capital. There are both conventional and SBA lenders . A vast majority of our recent deals have been SBA loans.

Q: Why do people sell their accounting firm?

Accountants and CPAs are looking to sell their business for a variety of reasons. Retirement is the most popular reason but there are a few more you might not be aware of, such as: Other business interest Health concerns Relocation Burnt out