"The clients transfer" is a phrase that hides a great deal of work. Clients are not an asset that changes hands at completion in the way a lease does. Each one is a set of separate arrangements: an agreement with your firm, an ongoing service they pay for, an adviser charge instructed to a provider, an agency relationship with a platform, and a body of files recording what they were told and why. Selling the firm does not automatically move any of that.
Understanding the mechanics matters commercially, because the gap between "clients transferred" on the completion statement and "clients still paying twelve months later" is where a large part of your deferred consideration lives.
Share sale and asset sale behave completely differently
This is the first fork and it changes everything downstream.
In a share sale, the client's contract is with the company, and the company is still the company. Ownership of its shares changed, but the counterparty to every client agreement, every platform agency and every provider instruction did not. Legally, most of the transfer problem disappears. This is the simplest route for continuity, and it is also why buyers examine the firm's history so much more carefully, since they are acquiring everything that came before along with it.
In an asset sale, the buyer is acquiring the client relationships out of your company. Contracts do not simply move: rights may be assigned, obligations generally need novation, agencies need re-establishing and adviser charging usually needs re-instructing. Gunner & Co reports that asset purchases currently comprise 62.5% of offers, so this is the more common route and the one with the real workload.
The distinction is set out fully in asset sale or share sale.
The steps in an asset sale, in order
Establish who owns the relationship. Before anything else. The FCA is explicit that the client bank is the firm's asset and that claims that someone else owns it need proof. Where advisers are self-employed, where the firm is an appointed representative, or where there is an old understanding about adviser books, resolve it in writing first. This is the issue most likely to stop a deal late.
Decide the consent model, and take advice on it. Broadly, clients are either asked to opt in to the new arrangement or told about it and given the opportunity to object. Which is appropriate depends on what is actually changing for the client: the service, the fee, the adviser, the legal counterparty, the data controller. Opt-in produces cleaner consent and slower, lower conversion. Opt-out converts more and carries more risk if what is changing is material. This is a decision for your compliance and legal advisers on your specific facts, not one to take from a website.
Write to clients once, clearly, jointly if possible. A single well-drafted letter that says who is taking over, what changes, what does not, what it costs and what the client needs to do beats a sequence of partial communications. Where the buyer and seller write together, the client sees continuity rather than a handover. Telling your clients covers the content and the timing.
Re-paper the ongoing service. The client's ongoing advice agreement is with your firm. The buyer needs their own, on their terms, with their fee basis. This is the step at which a client actually notices the sale, and where fee differences surface.
Re-instruct adviser charging. Ongoing adviser charges are paid by providers and platforms on instruction. Those instructions need changing, per client, per plan, per provider. This is administratively the largest single task and the one most often underestimated. Every failure leaves income being paid to a company that no longer services the client, which is both an income leak and a conduct problem.
Move the agencies. Platform and provider agencies need transferring or re-establishing so the new firm can transact and see the business.
Hand over the files. Suitability reports, fact finds, risk profiles, correspondence. The buyer needs them to advise safely; you need them for your own regulatory record. Both are true at once, and the agreement should say who holds what and for how long.
Why this determines the price you actually receive
Two reasons, and both are worth understanding before you agree a structure.
The first is timing. Each step above is a point at which a client can do nothing, and doing nothing usually means not transferring. A client who does not return a form is not hostile; they are busy. Conversion is an operational discipline, not a sentiment, and the firm that chases well retains more.
The second is measurement. If your deferred consideration is measured on retained income at a date, then every unreturned form and every unre-instructed adviser charge sitting in a queue on that date reduces your payment. Ask, before signing, how the measure treats clients who have transferred in substance but not yet in paperwork.
What good looks like from the client's side
The FCA's multi-firm review of consolidation found that poorly managed integration risks poor consumer outcomes, and identified strong governance and comprehensive risk management as good practice. Translated to the client's experience, a well-run transfer means they are told once, by someone they recognise, before anything changes; the person they ring is named; the fee is stated plainly, including if it is going up; and nothing about their plan changes without a separate conversation.
A badly-run one means a letter from a firm they have never heard of, a fee change they discover on a statement, and nobody obvious to call. That client is not lost because the advice was poor. They are lost because nobody told them what was happening.
A timetable that works
The order matters more than the speed, and the common failure is doing the client communication before the operational preparation is finished, which produces questions nobody can yet answer.
Before completion. Resolve ownership of the relationships in writing. Clean and reconcile the client and income data. Agree with the buyer who writes to whom, when, and in whose name. Agree the fee position and how it will be explained. Identify the clients who will get a call rather than a letter, and who is making it.
At completion, or immediately after. The joint letter goes out, once, to everyone, saying what is happening, what changes, what does not, what it costs and who to contact. Personal calls to the priority segment happen in the same week, not a month later.
The first sixty days. New service agreements issued and chased. Adviser charging re-instructed provider by provider, with a tracker showing what has been done and what has not. Agencies moved. Introductions to successor advisers under way for the clients who warrant them.
Ongoing until it is finished. Chasing. This is the least interesting part of the process and the part that determines the outcome. The difference between a firm that retains most of its income and one that does not is very often a spreadsheet and somebody whose job it is to work through it.
Why the size of the prize is worth knowing
It is easy to treat the transfer as administration and resource it accordingly. It is more useful to see it as the mechanism that determines how much of the agreed price you actually collect.
Running your recurring income through this site's free IFA valuation calculator gives the range the firm sits in. Whatever proportion of that range is deferred and measured on retained income is, in effect, the budget at risk during the transfer. Set against that figure, the cost of a dedicated person chasing forms and re-instructions for three months is trivial, and the return is immediate.
Sellers routinely under-resource this and over-resource the negotiation. The negotiation sets the ceiling. The transfer decides how close to it you get.
The thing to insist on with the buyer
One named person, on their side, accountable for the transfer, with the authority to make decisions and a weekly point of contact with you.
Transfers fail when responsibility is distributed: compliance owns the consent model, operations owns the re-papering, the adviser owns the relationship, and no one owns the outcome. If the buyer cannot name the person, the transfer has not been planned, and the fact that they have done this before does not help you if the team who did it is busy elsewhere.
Read next: telling your clients, clients who will not move, and the rest of the people and clients pillar.