Sometimes We Just Can’t Help

After more than a quarter-century advising firms on succession and ownership transition and roughly 900 mergers of CPA firms, we’re pretty confident we have the playbook down pat. We’ve certainly helped more firms who asked for our consult than those we couldn’t.

But sometimes as hard as you try, you just can’t help some firms – especially when trying to save them from themselves. There are those who think they know more than we do, and that’s certainly their prerogative.

Like the firm in New England who turned down our help in a merger claiming our fees were too high and has, for the past six months, been trying to unwind a disastrous union that’s costing him thousands more in legal fees alone than we would have charged for our consulting services. It was a very expensive and not to mention, unnecessary, lesson. I’m not one to wag my finger after the fact, but boy I told him so.

Then there was the firm in the New York-New Jersey market who contacted us and was interested in either selling or merging up. He was a sole practitioner making a ridiculous amount of money but putting in an absurd amount of chargeable hours. I advised him that a larger firm would assume all his admin and billing responsibilities, offer a greater platform of services for cross-selling as well as implement a new business incentive plan.

And guess what? We found a firm willing to do all that and in the process keep him whole in income despite the fact his annual comp was nearly twice that of the partners at the potential successor firm.

And yet like a nervous pitcher, he balked – claiming he could not discern a difference of merging with them or continuing on his own. Again I went over chapter and verse about how he had no succession plan and should tragedy befall him, what would happen to his staff not to mention his client base?

Still he remained unmoved.

Much like debating whether to perform an expensive repair to an aging car, in this business I have gradually learned when the law of diminishing returns begins to take effect and this was a prime example of when to politely say it’s time for both of us to move on and good luck.

Sometimes no matter how plain the situation is, people tend to interpret it through their own rose colored glasses.

After all we’re succession specialists, not optometrists.