The Current High Demand for Accounting Practices for Sale

Tax season is winding down. It’s time to start another “lap around the track” – or is it?

Right now, there is high demand for accounting practices available for sale or acquisition, so it’s a good time to consider the possibility of selling your practice, to move on to another life chapter or opportunity, or even retire.Don’t think you’re ready yet? There are still a lot of reasons to get a business valuation and an exit plan in place before next year’s tax season to take advantage of opportunities and not fall prey to circumstances outside your control.

There’s never been a better time to develop an “Exit Organizer” for your accounting practice. There are lots of buyers who might be interested in purchasing your business. Why?

• First. The fact that there are over 1200 accounting firms in the state of Minnesota alone. The industry is highly fragmented, which offers consolidation opportunities for buyers. Consolidation is driving premium valuations for the right accounting firms.
• Second. Accounting firms have tended to offer more bundled tax, audit and advisory services, which generate more recurring revenue and loyalty. Firms with these services are even more valuable in the marketplace.
• Third. as mentioned. Businesses utilizing cloud platforms, AI and automation enable scalability and capability for remote service can be very attractive for the right buyer.
• Overall, the industry offers buyers sources of predictable, consistent, high margin and contractual recurring revenue streams. In many cases, an accounting practice also creates the opportunity for synergies by expanding into advisory and wealth management services.

An accounting practice can be an attractive target for the right buyer, in search of established, relatively predictable revenue and upside. Sunbelt Business Advisors and True North Mergers and Acquisitions has acted as agent for the successful sale of fifty accounting practices since 2020. These were all family- and founder-owned businesses. And, having helped all these business owners with the sale of their practices, we can offer significant experience for you to draw upon.

Getting Ready: Build Your Advisory Team

Selling your business is likely the largest and most complex financial transaction of your life. A casual conversation with your financial planner or a rough draft of your will is not exit planning — it's wishful thinking. Selling your business is a lot more than an accounting transaction. Real exit planning means assembling a team of specialized advisors: a financial planner, perhaps an outside tax consultant, a transactional attorney, and critically, an M&A advisor who has actually structured and closed deals in your industry.

Before that team can go to work for you, honestly answer these three questions:

• Are your financials clean, accurate, and defensible? Buyers — especially private equity — will scrutinize every line item. Inconsistent records, owner add-backs that can't be supported, or weak balance sheets will erode valuation and kill deals.
• Can the business operate without you? A company that runs on the owner's relationships, approvals, and presence is a higher-risk acquisition. Buyers pay premiums for businesses with capable management teams and associates and documented processes.
• Do you know what your business is actually worth?Have you undergone a real business valuation process in the past. This isn’t what you think it's worth — it means what a sophisticated buyer in today's market would pay.

Business valuation is both art and science, and for most owners — who have 80–90% of their personal wealth tied to their enterprise — arriving at that number is one of the most consequential financial exercises they'll ever undertake. A professionally developed valuation, grounded in current market data and deal comps, meaningfully improves your odds. Why does this matter?

Nationally, approximately 70% of business sale transactions fail to close. The stakes are too high to rely on guesswork. A successful transition doesn't just affect you. Your employees, vendors, customers, and community depend on continuity. The alternative — an unprepared, distressed exit — can result in a business being liquidated at a fraction of its true value. Perhaps, a lifetime of work, dissolved.

Whether the path forward is a sale to a strategic buyer, a private equity transaction, a management buyout, or a family transition, each option demands preparation.

It’s important to get a good business valuation, understand why deal structure matters as much as the price of the business, and avoid mistakes that business owners sometimes make regarding this critical decision and process.

Whether you decide to Grow or Go, the time to act is before the decision is made for you. The accounting industry is in a rare window — elevated valuations and active buyers are creating real opportunity. Getting an exit plan in place is one of the most important steps you can take to protect and maximize that which may have taken a lifetime to build – your business.Get a Confidential Value Range Assessment.

Whether or not you are considering a sale within the next year or two, it’s the perfect time to start with a confidential valuation conversation and get to work on a clear roadmap for an exit strategy, understand the value of your firm in today’s marketplace, and take steps to improve what your practice could be worth.

All it takes to get started is a brief phone call. Get started right now.

Contact Matt Sobieski, CPA

Sunbelt Business Advisors Accounting Practice Specialist

612-964-8884