A key factor in successful transition of clients, as a partner moves toward retirement, is how dependent the client has become on the individual, rather than dependent upon the firm.  In most firms, retirement benefits for partners are dependent upon the number of clients that remain with the firm.

So, it is important that you begin assessing how dependent your clients are on you, personally. In many small firms, clients are predominately “partner loyal”. The clients can’t differentiate their relationship with the firm from their relationship with a partner in the firm. The larger the firm, the more tendency clients have to be “brand loyal”.

If your clients are partner loyal you should allow at least two years for most of your clients to shift their allegiance from you to a successor in the firm. The reason for this is because of how little face to face interaction most accountants have with their clients today. Much of our communication is done electronically and impersonally. However, the relationship you have with your partner loyal clients is personal. They need to be assured that the day you leave will be a non-event for them. They will develop that confidence if you are personally involved in the transition process. In addition, you of course need to see that your successor is capable of taking over for you.

If you see most of your clients in person once annually, allowing two years for transition means only two visits and two opportunities to be personally involved in the transition process.

If you have a competent successor in place and they are ready to go, two years from the date you want to relinquish control may be soon enough to start the process. However, if your successor is a new owner in your firm, you may need more time to complete their development and instill confidence in your clients that they are capable of replacing you.

About the Author

Terrence Putney, CPA (tputney@transitionadvisors.com) is CEO of Transition Advisors, LLC, www.transitionadvisors.com, which exclusively consults on succession and growth strategies for accounting practices nationally and ownership transition. He can be reached at tputney@transitionadvisors.com or 866-279-8550.

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