Closing a practice cannot be an easy thing to do. It may involve loss of face and a degree of personal embarrassment as well as requiring labour for which it is impossible to charge anyone. Files and records must still be kept, or provision made for them to remain accessible, for such time as they may be needed. Closing accounts must be prepared. Also, anyone closing a practice but proposing to practise as an IP professional in the future, whether as a relocated sole practitioner, a fee-earner in a larger practice or in-house, must prepare a CV or trading prospectus which combines the truth with as much damage limitation as is compatible with it.
I suspect that several readers of this weblog have been through the same, or similar, experiences within their own careers. If any of them have comments, suggestions or advice for handling this sort of situation, this blog is willing to host them.
Closure of a firm is a frightening concept - and has happened to several firms in recent years both large & small.
ReplyDeletePerhaps rephrasing it as succession or buyout or something else.
We should always consider the upside - success - & the downside - closure - and attend to each scenario as soon as possible, since denial can result in further problems.
Thanks for bringing up a difficult subject
Considering the option of closure can also help you make decisions now that help your practice thrive:
ReplyDeleteFor example:
Go paperless, to meet the storage issues post closure;
Don't be scared but make moves that you believe in since you get one chance, so make it count;
Make associations that may help with succession if you close, whilst in the meantime it provides an option for temporary so you can go on leave
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Thanks for bringing up a difficult topic
As I was starting my business, I was privileged to hear a business man be interviewed as his business was undergoing severe difficulties and he was fully expecting to go under. It took an immense amount of courage to share his experiences to the benefit of others.
ReplyDeleteIt also showed that all business are born, have a life cycle, and in due course come to an end, sometimes we see neither the beginning nor the end, and are merely part of the journey.
However, businesses sometimes cease trading for reasons that do involve loss of face or embarrassment but are simply decisions taken for good reasons personal or otherwise.
Posting a list of things to think about when closing (or opening a practice) would be useful.
Upon closing a practice, putting clients interest first is essential, perhaps offering them a choice of practices to move to.
Record keeping post closure, particularly for closed or granted cases, is an interesting question, and I wonder what others thoughts are on this?
I think there is more of a stigma for service-based businesses as the closure can be interpreted as a personal failure.
ReplyDeleteHowever, around 10% of businesses close each year (279,000 in 2009 - 11.9%), so it is not necessarily a rare occurrence. Indeed, failure of a business is sometimes a necessary ingredient for future success.
There should be more understanding and less taboo surrounding this issue. I agree with 1 Place that going digital is one way to ease the transition on closure; limiting the damage and disruption to clients is maybe one way to be more accepting of the life cycle.
Apologies for my anonymity but I still a bit feel bad about my own personal experience of closing my practice. Somewhere between falsely accused of a crime and being bereaved, really.
ReplyDeleteBravo, Solo-IP for raising this topic.
An orderly closure of a practice need carry no associated stigma at all. Indeed, it does not necessarily imply failure. There may be a more new and more exciting job to go to, or the pleasures of retirement.
ReplyDeleteMerger of the practice into another is the ideal way of finessing an exit. If your expectations are reasonable, it should even be possible to make something out of the deal.
Does anybody know if IPReg has guidance on closures