- Michael Burne
How to sell a law firm: Negotiate a win-win deal
What to do once your law firm is ready to sell
So, you have decided to sell your law firm and want to make sure you receive a fair offer.
Last month, we covered the steps you would need to take to get your firm ready to sell, including setting a deadline, evaluating your finances and renewing your insurance. If you haven’t yet prepared your firm for sale, we would recommend going back and reading that blog first. However, if you have prepared your firm and are ready to put it on the market, keep reading to find out how to complete the sale.
1. Choose your terms
Before you can sell your law firm, you will need to decide what your terms are going to be. If you enter negotiations without a clear idea of what you want to receive for your law firm, you will likely end up agreeing to a poor offer, which you could regret later down the line. Instead, plan out exactly what you want to receive, to ensure you can negotiate with confidence.
Value of firm
Start by considering how much you think your firm is worth. By having a figure in your head of the minimum amount you would be willing to accept, you can enter negotiations with a clear idea of what you want from the sale. Otherwise, you could end up selling your firm for a lot less than it’s actually worth.
Speed of deal
Next, decide how quickly you want to sell your law firm. If you have a date in mind for when you want to leave your firm by, you can communicate this during the negotiations. This will allow you to structure the rest of the sale around the deadline you have set, allowing you and your buyer to work towards a common goal.
Finally, think about what exit plan you want to implement. Whether you are looking for an immediate exit or are willing to support the buyer for the next year, it’s important you decide what you want your exit plan to look like, to ensure a smooth transition of your firm, staff and clients. This will also help the buyer dictate how much risk is associated with buying your law firm.
2. Negotiate an offer
Once you know what you want from the sale of your law firm, you can start to connect with buyers. By being transparent about the condition of your law firm, you can ensure you and your potential buyer are on the same page from the very beginning. Remaining honest throughout the sale of your law firm will allow you to build a trusted relationship with your chosen buyer and enable you to move forward with the sale quickly and comfortably. It will also put both you and your buyer in the best position to achieving a win-win deal, as you will be able to openly discuss your terms of sale.
When you reach an agreement with your buyer, you will need to prepare a contract for you both to sign. This will outline all terms and conditions of the sale and include clauses that can protect you in the event of a dispute.
3. Communicate the sale
After you and your buyer have signed on the dotted line, you will need to put together a transition timeline. This should outline the sale of your firm, including when you will hand over your clients and when you will exit the firm. Once you have this prepared, you can communicate the sale of your law firm with staff. This will ensure you are equipped to respond to any questions or concerns your staff may have. Whether your staff will be able to continue working at your firm or not, it’s important you clearly communicate how the sale of your firm may impact them.
If you are in the process of selling your law firm, it can be useful to speak to a legal expert who has experience in law firm sales. The Bamboo Platform is made up of a team of legal specialists, who can advise you on valuing your firm and preparing a contract. To ensure you receive the best offer for your firm, get in touch with the Bamboo Platform and who knows we may even be the buyer you were looking for!