Three steps to a better business and a more secure future:
Over the years, talking to dozens of business owners who are 40+, I’ve learned that many have their head in the sand when it comes to a real plan for their eventual exit. They don’t know what their company is worth, who a likely buyer is or how to transition to family, and most importantly –- the amount of money they need to fund their future. Keep in mind that a business should have 2 – 3 years of profitability to maximize a sale price. So, the less time an owner procrastinates about a plan the better the outcome for the future proceeds from any sale or transition.
1. Set some goals for your exit by answering a few key questions. What would be the ideal scenario for your exit? How much money do you need to live the way you want? What do you want to do after you sell? When would you like to leave your business?
2. Tell your trusted advisor - whoever that may be - of your plans; accountant, lawyer, financial planner or business/exit advisor.
3. Get a valuation done so you know the true value of your business. This gives you powerful information from which to plan, grow and profit from your business.
I am sharing this article from John Carvalho of Divestopedia because it breaks the effort down to a simple action plan. The main takeaway from the article: Be proactive about your future and start your exit plan today with three simple steps.
"Exit Planning for 2018
Establishing your objectives, telling an advisor and getting a valuation are three simple places to start your exit planning for 2018. These are high-value activities that will provide additional benefits to your business and give you lucidity on the future. Maybe your exit planning turns into a more aggressive growth plan for your business or opens up an option that wasn't previously explored. No matter what you discover in this process, your business will be stronger and you will better understand your direction going forward.”
I've worked with many business owners in all states of readiness. Help is available to get your plan done, affairs organized and business drivers optimized so you can leave the business when and how you want. Give me a call and let's have a conversation about your plan.