Speaking to AccountantsDaily, chief executive of Connect Financial Services Brokers, Paul Tynan, said that “on a fundamental level” there are more buyers than sellers in the market at the moment.
He attributes this trend, which has spiked in the last five years, to accounting firms in particular struggling to master organic growth.
“They’ve been growing by acquisition for years, from the bigger companies right down the food chain,” he said.
“We do not teach how to do organic growth in the industry. Who talks about selling? Who talks about networking? Who talks about asking for referrals?” he added. “It’s not in the accounting DNA.”
While prospective sellers are in a good position to offload their practice on a numbers level, Mr Tynan said certain types of practices are struggling to attract the attention of new buyers – particularly millennials.
“I really do fear for the older generation,” Mr Tynan said. “These accountants are getting worried, because they’ve been sitting on their hands for a long, long time. Cloud technology in particular has changed expectations and changed the industry.”
He also noted that millennials are particularly hesitant to accumulate masses of debt in purchasing a practice.
“When you say ‘you have to go into this much debt,’ they don’t want it,” Mr Tynan said.
“They have housing market debt and they are still paying off their education.”