Almost two-thirds of advice firm owners would sell up early for the right price, a poll has found.
The study by consultancy group Harrison Spence suggested 61% of IFA business owners would sell the company if they received a healthy offer, despite a similar proportion (57%) indicating they have no current plans to sell.
Harrison Spence concluded many advisers are delaying their sale plans until valuations become more attractive, with many taking a five-year view.
But managing partner Brian Spence suggested advisers could face an awkward decision when conventional accounting methods lead to their business being "hugely undervalued".
The industry, he said, has seen a sizeable shift in valuations towards firms' net profits rather than recurring income.
He suggested many advisory practices are set up as small lifestyle businesses with one or two advisers and, as their focus may be to maximize income for owner-managers, rather than bottom line for the corporate entity, in some cases firms are showing little or no net profits.
"The shift from income to profit generation is going to be a difficult transition for some IFAs, but the days of the lifestyle business are numbered," Spence said.
Harrison Spence's study received more than 100 responses.
