Strike whilst the iron is hot

by | Mar 22, 2021 | For Clients

In the last few weeks, we at Harrison Spence have seen more would be purchasers come on to the market than in a good number of years.  We have spoken to many and most have demonstrated they have funds ready and available to acquire businesses.   

For some time now the standard valuation matrix for IFA practices has been a multiple of recurring income. But that is changing…

IFA practices are not dissimilar to houses. If the house of your dreams comes up for sale and you are facing competition you could be persuaded to pay more than its current market value to secure the deal.

So it is with an IFA practice. Supply is limited. Buyers are willing to pay extra for good practices and with current market conditions as they are, if you are considering IFA sale, now is a good time.  With more sellers in the arena, it also offers a wider choice to obtain that all important “Cultural fit”

We are also finding that Increasingly buyers are looking at EBITDA – profitability – as a measure of quality and therefore of valuation.

We are helping firms achieve excellent offers based on their EBITDA. For well-structured businesses this can work out significantly greater than the traditional multiple of recurring income. We can help you improve your profitability and ultimately therefore the eventual sale value of your business.

If you are planning to retire in the next 5 years, please give us a call, it may also be possible to lock into a deal now to take advantages of current market conditions.  This option could provide peace of mind, and if you require it, some funds on the table now.

As  the leading independent consultants to the retail financial services sector, we are well placed to help you explore your options.

To discuss your situation in confidence, please do  get in touch.