LAWYERS CRITICAL TO A SMOOTH DEAL

Radar Results, M&A consultants to the financial planning industry, recommend the use of specialist lawyers who have experience with financial planning transactions. Principal for Radar Results, John Birt, stated that he had seen many sales either stumble or drag out or just fail because lawyers involved in the deal were not experienced. Birt said, “We have developed a panel of lawyers on our website; they’re specialists who are very experienced.” He continued “It’s got to the stage that if a financial planner approached Radar Results to sell their business, and if they didn’t want to use a ‘panel lawyer,’ you’d have to think that there would be problems.” To review a panel lawyer in your city, simply go to our website to order your own DIY Sellers Kit.

SYDNEY AND PERTH DROUGHT

Associates for Radar Results have reported that the number of financial planning practices for sale in Sydney and Perth has dried up. Compared to some other states, particularly Queensland, the number of practices for sale is the lowest it has been since 2007. Unfortunately for buyers in these particular cities, the supply and demand curve may force up prices.

ORPHAN CLIENT VALUES TO FALL

There are many definitions of an orphan client, a D grade client and a C grade client.

Measures have been taken to recover lost superannuation accounts and from July 1st 2013, accounts of those members with up to $2,000 who have been unable to be contacted will be transferred to the ATO, with interest to be paid at a rate equivalent to Consumer Price Index inflation. This limit of $2,000 is expected to rise to $3,000 in 2014 and may eventually be limitless. These measures may reduce the sale value of ‘lost members’, which is already at an all-time low.

Historically Radar Results has always received requests wanting to buy as many clients as possible, the smaller the revenue-per-client the better. This trend may well be ending, especially with FOFA and fee-for-service set to dominate in the future.