Succession planning is a significant issue for many practice owners. There are a number of steps and strategies that practice principals can go through and adopt that will help set them and their business up for success when it comes to succession planning.
First and foremost, they need to know the numbers and run their business as a business. We believe that a client-centric business that is commercially focused and driven will always have more opportunities in successfully finding a buyer. This is critical to maximising the sale price of your practice.
Second, know the kind of clients you serve and the kind of value you deliver to those clients. Be clear about the way in which you go packaging those services as well as the level of value above and beyond the cost associated with the delivery of those services.
Third, be very clear at a whole-of-business level as to how you go about articulating that value to your internal stakeholders, your external stakeholders, your clients and your community.
The fourth and last point is that you need to make sure that the client market you are targeting is large enough to meet your aspirations. Your financial planning practice is not going to grow if your market penetration is 20, 30 or 40 of even up to 100 per cent – if your unique market is so small that it can’t sustain itself.
So make sure you run a client- centric, commercially driven business, be very clear about the types of clients you serve and understand what your customer value proposition (CVP) is, make sure that your whole business can articulate this, and in identifying and targeting your ideal customer, make sure the potential client base is large enough to grow your business.
In my next blog, I will discuss how to clearly articulate the ‘why’ of being in business and how to help clients buy into this.
