How to Sell a Practice. Tips for Success with Rebecca Smith

Who is Rebecca Smith?

Smith has a colorful and varied path that has brought her to where she is today. Based in Florida, Smith is originally from Costa Rica. She moved to the US when she was ten years old. Smith attended the University of Florida and completed a degree in Psychology. With an impressive marketing portfolio behind her, she is a licensed Broker in Florida and a member of the International Business Brokers Association, as well as the Business Brokers of Florida Association.

"My professional trajectory is what makes my journey colorful,'' says Smith. Upon graduating, she began a business out of a business incubator and grew it. She was eventually able to sell it. Within that business she created separate sister companies that created new and exciting opportunities.

"We sold products to the Home Shopping Network. We had a collegiate license company. I really enjoyed creating these opportunities," says Smith.

She discovered the profession of business brokerage around the same time that she was thinking about exiting her business.

"It felt like it was fate. I started practicing as a business broker seven years ago, which coincided with selling my business."

Smith is now a business broker. She helps all types of businesses, but has a special interest in helping CPA firms and practices exit their businesses.

Smith also assists CPA practice owners grow through acquisition— she helps CPAs find firms to buy.

What Are Important Points a CPA Should Consider When Selling a Practice?

Selling your business is scary for most entrepreneurs.

"It is completely normal to have a feeling of apprehension. Selling your business is like selling your baby. You have worked hard. You have put in your blood, sweat, and tears," she says.

According to Smith, there are many reasons a business owner would consider selling their business. The top reasons business owners sell are:

• Retirement
• Necessity
• Personal life changes (relocation, divorce, illness)
• Ready for a new career

"Although there are many different reasons. It is a difficult decision to make," says Smith.

According to Smith, business owners are hesitant to sell for the following reasons"



• Fear of missing out on potential revenue.
• The concern of what they will do afterwards.

"There are a lot of considerations, but these are some of the main concerns that I have seen, '' says Smith.

Quick Rules of Thumb When it Comes to Timing and Selling Your Practice

How Does a Business Owner Optimize Their Business to Get the Best Selling Price?

In Smith's experience, money is not the only factor that will attract a high paying buyer.

"I have sold businesses that had no profit. There is a buyer out there for everything. I have seen instances where a buyer is enamored with a business concept and they buy it," says Smith.

According to Smith, a different owner may have the means and strategies to turn a business around. For CPAs and business owners wishing to sell their practice, the best case scenario is that you have a turnkey practice.

A turnkey practice has the following elements:

• A practice that is not owner dependent.
• A team that runs smoothly and is fully equipped to handle their duties and responsibilities. 
• A practice that has a solid operational plan, with its systems and processes in order.
• Make sure that your practice has a good reputation, including good online reviews.
• A practice that has multiple revenue streams.



"Some examples of multiple revenue streams for CPAs include—tax preparation for both business and personal services, accounting services, business advisory consultation and special projects such as forecasting and formations of solutions," says Smith.

What are Some Ways to Stay Involved Once the Seller Sells the Business?

Training and transition period

"There is always a training and transition period for the buyer. This is something that can be negotiated. When a buyer puts in an offer, they may counter what you originally offered as a training and transition period. If you say that you would stay on for a month to train the new buyer, this would be an extra month that you would be involved in the business after you sell the business. It is a part of the deal. Usually you are not getting paid for the extra month," says Smith.

Part Time Worker/ Consultant

"In some cases, the buyer may feel more comfortable bringing you on as a consultant or as a part-time worker for a period of time," says Smith. 

According to Smith, everything is negotiable, including the time period you stay on. 

She adds, "If you are offering a specific service within a CPA firm that the new owner does not have expertise in— you can continue taking on that book of business and have some sort of share revenue agreement with them."

Are You Ready to Sell Your CPA Firm or Business?

Every business is unique and has different needs, with a different set of items to be negotiated.

"Both, selling a business and buying a business are highly emotional transactions," says Smith.



"It is not only a practical decision based on numbers. Selling your business has several key factors that matter. This is when having a business broker is a huge benefit. Having someone in the 'middle' that is managing the communication without the emotional component is extremely beneficial," says Smith.