Do your homework.
Advisors who have successfully pulled off a sale share another trait, according to the report: They thoroughly researched how deals are structured, put into motion and ultimately completed.
One of the most important things an advisor can do, the report states, is talk to people who have already sold their practices.
This is in addition to researching professional advisors who can help get through the transaction, the buyer’s market and the potential value of their business, according to the report.
“Most importantly, they develop a general understanding of what the M&A market will likely pay for their firm and under what conditions,” the report states.
Become realistic about what buyers are willing to do.
Advisors can have an inflated view of the quality of their practice and, consequently, its selling price, according to the report.
A key to a successful sale is being able to look at your business objectively.
“Savvy owners force themselves to move beyond these emotions (fantasies, really) and become realistic about what it is they are actually selling,” the report states. “They accept that what they own is simply a very tiny business that … does not make very much money.”