Why finance a legal practice purchase?
Although there is often significant cost involved with purchasing a law firm, there are many reasons potential buyers opt to do so, despite the potential problems with financing the purchase of a legal practice. An obvious example is a lone qualified lawyer who strives to operate his or her own firm and wants to finance a legal practice purchase rather than build a new firm from scratch. Whilst this seems a more costly option, the advantages associated with the purchase of an existing firm can reap higher rewards far quicker than starting a new firm. However, unless the buyer has savings or personal income which allows them to fund the purchase, it is likely they will need to seek financing in order to purchase a legal practice.Even established companies who wish to take over another firm may not have the capital freely available to do so. Despite being established and successful, existing firms may also need to obtain legal practice financing. Fortunately for potential buyers there are a number of ways they can obtain legal practice financing in order to fund the purchase or acquisition of a law firm.
Why do I need a legal practice broker?
If you’re considering buying or selling a law firm it’s likely you’ve considered using a legal practice broker. It can be a common assumption that the use of a legal practice broker is not essential to a transaction, particularly if the buyer and seller are both experienced solicitors. However, many experienced professionals have lost money by opting to conduct a sale without a law firm broker. As experts in their field, legal practice brokers can provide invaluable advice and assistance when you are considering buying or selling a legal practice.It goes without saying that if you’re selling your business you want to sell at the highest price possible and if you’re buying a business you want to buy at the lowest price possible. Although these two figures may not always tally, the use of a legal practice broker can help you avoid common mistakes and ensure you achieve the best possible deal.
Why buy a legal practice or law firm?
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There are a number of reasons people choose to buy a legal practice and the motivating factors largely dependent on the buyer. Lawyers who want to operate their own firm often considering buying a legal practice to be a faster route to success than setting up a new firm. The fact that setting up a new business and building a reputation can take years means that buying a legal practice is often a viable alternative. The infrastructure of the business and the staff are already in place and the business can continue to operate with limited downtime, particularly when compared to the difficulties in launching a new, previously unknown firm.It’s relatively common for mergers and takeovers to take place within the legal industry and larger firms will often buy a legal practice or a number of practices in order to expand their own business. Whilst the financial figures will, of course, be of paramount importance when choosing to buy a legal practice, existing firms may have more options available to them compared to independent buyers. For example, an existing well- known firm will not have to work as hard to establish the company and create a reputation if they are known regionally or nationally but this may take significantly more time for an unknown lawyer.
Why do you need a law firm valuation?
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When a law firm valuation is required it’s essential that each factor and variable is assessed appropriately in order to calculate a genuine and accurate valuation of the firm. Whilst many people assume a law firm valuation is only required when it comes to selling the business, there are actually numerous instances which may indicate a need for the firm to be valued. Whether it’s the sale of the firm, the formation of an LLP, a new Partner joining the firm, the purchase of another firm or simply general interest, there are several factors to consider when undertaking a law firm valuation.
When do I need a legal sales lawyer?
Once the decision has been made to buy or sell a business, many people choose to contact a legal sales lawyer in order to find out more information and aid them in the sales process. It’s likely that a legal sales lawyer will work as part of a team to ensure the sales transaction is carried out accurately and successfully.Whilst some people opt not to engage the services of a legal sales lawyer, this decision is often subject to regret later in the sales process or once the transaction has been completed. Although it can seem like a costly addition to the purchase or sale of your legal practice, the use of a legal sales lawyer can save vast sums of money in the long term and can even avoid costly legal fees or litigation in the future.
Selling a law firm: How to go about selling your legal practice?
When deciding whether or not to sell a law firm there are a number of things to consider. Anyone who chooses to sell their law firm wants to make as much money as possible from the sale but various factors will have an impact upon the value of the firm and the market and flexibility of the seller can affect the price and sale of the firm.Professionals who want to sell a firm as they are choosing to retire are often in an enviable position as they can make the decision to sell a law firm a significant time before the sale takes place. This affords them the time to make any changes necessary to increase the likelihood of sale and increase the price. For example, the may choose to take on an associate for a number of months or years prior to actually selling the law firm. This potentially increases the value of the firm as clients are familiar with the new owner and are more likely to continue using the firm. The potential transferability of the firm’s work is increased so the value of the firm increases, potentially leading to a higher price when the law firm is sold.
