What Really Drives the Value of a Bookkeeping Practice?
When most bookkeepers think about selling their practice, they focus on one number: revenue. But buyers don’t buy revenue, they buy recurring revenue, stable systems, and low owner dependence. That’s why bookkeeping practices are valued primarily on EBIT or EBITDA multiples, typically 2.5× to 4.0×, with goodwill making up 70–90% of the total value.
Here’s what the top-valued practices have in common:
- Recurring monthly fees
Fixed-fee retainers with direct debits = predictable cashflow + higher multiple. - Strong systems
Xero, QuickBooks, Dext, Hubdoc, workflow tools — systemised firms sell faster and for more. - Low owner reliance
If the owner does all the work or holds all the client relationships… the multiple collapses. - A stable team
Buyers pay for capability and continuity — not chaos. - High client retention
Low churn = high goodwill. It’s that simple. - Clean, documented processes
Transferability increases buyer confidence and valuation. - Growth upside
Practices offering management reporting, dashboards, and virtual CFO services attract premium multiples.
A small, owner-dependent practice might sell for 2.5× EBITDA. A larger, systemised, team-driven practice with recurring revenue can push towards 4.0×. And this is where accountants and advisors make a real difference.
We can help bookkeepers:
- Benchmark their margins
- Shift to fixed-fee recurring billing
- Reduce key-person risk
- Systemise and document workflows
- Improve client retention
- Build advisory capability
- Increase EBIT margins to 25–35% (Top 20% level)
Valuation is not an event, it’s a strategy. Every improvement you make today lifts the sale price tomorrow.