As Mr Morrish observes: “Selling your business isn’t like selling your car, where you are unlikely to ever see the car or hear about its ongoing performance on the road again.
“Your clients and your staff will hopefully be in the business long after it is sold, so ensuring that their future ‘home’ is as you would wish it to be, is a key part of your own due diligence on who you might sell to.”
Continuity is key
Here, the main aim is continuity.
But to achieve this might mean waiting until the sale process is further down the line before informing your employees, and in turn, clients.
Chris Budd, business consultant at The Eternal Business Consultancy, warns against informing employees and colleagues too soon of your plans for the business.
“It’s really important you don’t tell your employees too early because you may create expectations about something they don’t necessarily fully understand yet,” he explains, referring in particular to structures like an employee ownership trust.
He says that business owners need to take time to pave the way – and that goes for telling clients too, “because the amount of money you get from a sale is going to rely upon the clients staying”.
“A key consideration for advisers looking to sell their business should be to maintain client and staff continuity as much as possible,” says IWP’s chief executive David Inglesfield.
“Choosing an acquirer with the right fit culturally will be essential to avoid any client or key staff attrition and retain the value in the business, as well as ensuring it can grow.”
If there are some difficult conversations to have, then have them. That is the advice of Ms Hicks.
“Being open and honest from the early stages – and offering a share of the sale, if needed – will help encourage key persons to stay,” she says, adding that the worst thing to do is pretend such thorny decisions do not exist.
“If customer loyalty will be affected as a result of the buyer’s differing approach to service, charges, or investment propositions, it’s important these are addressed early on, especially where you consider a large proportion of the consideration is often dependent on client retention.”
Mr Inglesfield agrees that another long-term consideration is staff succession planning, especially for key roles such as advisers.
Before and after
When planning for the sale of their company, advisers will need to account for a period of time after the transaction has completed, as the work does not stop there.