Contents
- 1. Reduce owner-dependency (start here)
- 2. Re-price under-charged clients
- 3. Grow your recurring percentage
- 4. Reduce client concentration
- 5. Tidy systems, WIP and lockup
- 6. Document the handover
- 7. Add advisory where it fits
- A simple 24-month plan
- Where to start today
- Questions
Two practices with identical fees can be worth very different amounts because they differ in quality. The market and the tax rules are outside your control, but most of what makes up quality is within it. Seven changes move value most, and they appear here in rough priority order. Each comes with a typical timeframe and an indication of how much it can lift the price. Starting 12–24 months before a sale gives the changes time to build on each other.
1. Reduce owner-dependency (start here)
This is the single biggest driver of value, because it's the single biggest risk a buyer is pricing. If the relationships, the pricing judgement and the "how we do things" all live in your head, the buyer inherits a firm whose value could leave with you on completion day. The fix is deliberate delegation: introduce second contacts on your key clients so relationships are shared; hand pricing and review authority to managers; and write down how work gets done. Impact: large — this alone can move you a whole quality band. Timeframe: 12–24 months (it takes time for delegated relationships to bed in).
2. Re-price under-charged clients
Loyal clients who've never had a fee review reduce value in two ways: lower income now, and a re-pricing job (with churn risk) that the buyer will have to do later — and price in. Stage sensible increases at renewal, starting with the clearest cases. Done well, it lifts both the fee base and the multiple, because it shows a well-run, commercially healthy firm. Impact: large. Timeframe: 6–18 months across a renewal cycle.
3. Grow your recurring percentage
Convert ad-hoc and project work into predictable, repeating engagements where the work repeats. For example, move a client onto a monthly bookkeeping-plus-management-accounts retainer, or an annual advisory package. Buyers pay more per pound for income they can count on. Impact: medium/large. Timeframe: 6–18 months.
4. Reduce client concentration
If a handful of clients make up a large share of fees, that's concentration risk, and buyers discount it. You can't always broaden the base quickly, but you can strengthen and document those key relationships — multiple contacts, clear service records, and (where possible) longer engagement commitments — so a buyer can see the risk is being managed. Impact: medium. Timeframe: ongoing.
5. Tidy systems, WIP and lockup
Up-to-date software, disciplined billing, low lockup and clean, current debtors make due diligence smooth and show a buyer that the figures can be relied on. High WIP and old debtors suggest hidden problems and lead to a discount. Impact: medium. Timeframe: 3–12 months.
6. Document the handover
Processes that exist only in your head can be written down cheaply, with simple checklists, client notes and a documented client journey. Easier transition is worth more because it directly reduces the buyer's retention risk. This also pairs naturally with reducing owner-dependency. Impact: medium. Timeframe: 2–6 months.
7. Add advisory where it fits
Advisory relationships deepen loyalty, lift fees and give a buyer more to build on, and each of those supports the multiple. The first step is to free capacity, for example by outsourcing routine compliance. See moving from compliance to advisory. Impact: medium/large over time. Timeframe: 12 months+.
One practice before and after 18 months of changes
A £250,000 practice, owner-run, with several under-priced clients, sells today at roughly 0.85× = £212,500. Over 18 months the owner delegates the top ten relationships to two managers, re-prices to £280,000 of fees, and documents the core processes. It now presents as low-dependency, well-priced and clean — roughly 1.1× on the higher base = £308,000. The uplift is about £95,000, and the same work makes the firm calmer to run.
A simple 24-month plan
- Months 0–3: Get your numbers straight (fee analysis by client, recurring %, top-10 concentration, lockup). Pick the two changes that would lift your value most — usually owner-dependency and pricing.
- Months 3–9: Start delegating key relationships; begin staged re-pricing at renewals; document core processes.
- Months 9–18: Move more ad-hoc clients onto recurring engagements and, where it fits, add advisory; keep re-pricing; tighten WIP and lockup.
- Months 18–24: Consolidate. By now the firm should run through its people and systems and be in good shape to sell.
Where to start today
Pick the two changes with the biggest impact for your firm and begin with those. Start from a realistic valuation and our calculator, and track the KPIs that show progress.
