Determining a Merger Strategy


There has been an unprecedented number of firms combining their practices as an integral part of achieving their long-term strategic plans, rather than as a remedy for short-term succession problems. The strategic approach to merging has added substantiation to what we have been observing in the marketplace—there is relentless pressure on leaders of small to medium-sized accounting firms to grow in a very competitive market for new clients while simultaneously competing for quality staff.

Increasing pressure from large regional and national firms with comprehensive service offerings and significant internal marketing and HR resources keeps partners at small firms awake at night. For many of these firms, the most effective strategy to retain their best clients and staff, obtain more technical and advisory resources, and grow their practices is to combine with another firm.
There are a few important considerations in evaluating and determining the best firm to combine with:

  • Determining the strategic goals and objectives that have the best potential of maximizing revenues and profitability in the local marketplace and partnering with a firm that can make a short-term impact in achieving the intended results.
  • Obtaining valuable skills, competencies, expertise, and advisory capabilities to better service existing and prospective clients.
  • Adding financial stability to the long-term future of the firm.
  • Solving future succession planning issues, both in terms of firm leadership and transitioning of clients.
  • Adding comprehensive resources for marketing, practice development, and lead generation to attain greater competitiveness and achieving higher levels of growth.
  • Obtaining the necessary HR resources needed for growth, succession, recruiting, retention, and staff development.
  • The combination allows for making the necessary but tough business decisions that were too challenging to implement in the past without the support and resources of another firm.

Developing a merger strategy to select the best firm to partner and combine with is crucial to a successful future. Determining and agreeing on the best criteria to achieve a successful merger is imperative to making the right decision at the right time.