The threat of clients leaving a financial practice directly after a merger or acquisition is very real. Clients tend to fret that the service offered will change dramatically and begin to look elsewhere.  

This theory is backed up by a Deloitte study which suggests 17% of personal banking customers switch banks following a merger or acquisition.   

It’s on the hands of both the buyer and departing owner to calm these fears, by communicating as many details about the deal as possible and negotiating a smooth transaction with maximum continuity. 

Below are some tips to help them do this: 

Communicating with Clients as Early as Possible

The first step of your client retention strategy should involve creating a solid communication plan to ease any fears of dramatic changes once the transaction has completed. 

Clients left in the dark tend to assume the worst, so the more information you can reveal early on the better. Early and frequent communication is the key to retaining your clients following a transaction like this. 

You’ll want to communicate why the merger is taking place and how this can help the clients experience a better service in the future. 

Make it a two-way conversation, so that the clients are free to express their concerns and you can address them. This is the best way to understand what is worrying your clients the most. Extend this two-way conversation to staff members, who often experience similar concerns to clients in times like these. 

Ensure a Smooth Transition

If your clients are told they won’t experience a lot of change, and this turns out to be the case, they’ll have no reason to flee for the exit door, especially if there is a host of new services available as a result of the merger.  

The best way to ensure that this scenario takes place is to ensure that the buyer is on board with the company culture and the processes currently taking place within the practice. Many departing owners will remain on board in an advisory role for a while, so that the buyer can learn about these things on the job.

Ultimately, it’s down to the new buyer to ensure that the company culture remains the same as when the company was thriving, but having the departing owner on hand to advise them will certainly help them to do that. 

Selecting an Appropriate Buyer    

Buyers should be well aware of what the company’s churn rate was before they came on board. If they can keep these percentages from rising, then they can consider that a brilliant start to life in charge of their newly acquired business.  

With any business transaction, it’ll require a deep, constant level of communication between the buyer and departing owner to ensure clients remain on board. 

That’s why it’s so important that company owners choose a buyer that they can work well with and communicate with easily. 

Succession Link provides an online platform which matches business owners looking to acquire or merge with a practice with those looking to sell up. Our huge database business owners makes it easier to choose the right individual for a smooth transition. Click the link to find out more about how Succession Link can help you.   

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