Every business owner who is considering an exit needs to understand the process and all of the steps required to accomplish the goals that the owner has for his or her exit. Few mistakes are as costly as not understanding the process and not having the needed help and input to maximize your success. Surrounding yourself with people who can aid in each step of the process is critical to meeting all of your goals.  This help can be as simple as just offering sound advice to actually performing many of the functions needed.  Do not leave money on the table thinking you can “go it alone”.

The first step in the exit process is to determine what you really would like to see happen with your exit and define these goals.  Some owners want to walk away from the business never to be seen again, while others will want to remain in the picture as part of the company even after selling out. There is no right or wrong answer to what your goals should be, but there are some key components that need to be included to be successful.  First, you will need to determine what you would like to see happen to your company, or who you would like to sell to.  Second, you will need to define your financial goals in the sale and make sure you are not relinquishing control until you know these financial goals are achieved.  Third, determine a timeline for your exit plan, and finally determine what you want to do in the next stage of your life that will be meaningful and keep you engaged.

Determining who you want to sell to can have a far reaching impact on your company’s future, your employees and your family.  It is important to think through the options carefully giving special consideration to the financial impact.  This is especially important if you may have to finance part of the sale, which is often the case when selling to family or employees.  If you would like some help you can contact me and I will provide you with an exercise to help identify some of the important questions when determining what makes the best sense in “Who to Sell To”.

Your timeline can be as flexible as you want it to be.  The most important aspect is to get yourself and your company prepared so that when you decide to pull the trigger the key components to be successful are in place completely or at least in process.  Depending on the current situation it may take several months or even years to get all the needed tools in place or to make whatever changes may be needed so the sooner you start the better.  If you set a timeline and work towards it you can still have flexibility.  As you get close to your anticipated exit date if you find that some of the components are not quite ready you can be flexible on making your exit.  Unfortunately without proper planning sometimes the timeline is not as flexible.  If you are suddenly dealing with some sort of health issue for yourself or a loved one ss an example, so again it is important to get the planning in motion to be prepared for unexpected events and be able to transition your company on your terms.

Determining your financial goals is one of the very first key components in a successful exit strategy.  Understanding what your financial needs are today and determining what you feel they will be in the future is key to understanding what proceeds you will need from the company when you sell it.  It will be helpful to have sound advice and good planning from experts to understand the intricate tax laws and strategies that can be used to help you maximize your financial success and reduce taxes. You may find the value of your company does not match your expected financial needs and you may decide to look at a “growth strategy” and or “value increase strategy” to help grow the value of the company so you can sell at a higher price and reach your financial goals.

The last piece is to determine what you want to do in the next stage of your life that is meaningful and has purpose.  A survey by Pricewaterhouse Coopers, found that within one year 75% of business owners regretted their decision to sell mostly due to poor personal planning for what they would do next.  If you want to be happy and fulfilled you must have a plan for what you will “Go To” that will be meaningful and relevant, not just a plan to get out.  There are tools available  to help determine what will give you a great finish in the next stage of your life.

Working with experienced people who understand your goals and timeline will offer you the chance to understand and consider many options that you may not have considered in putting together your Transition plan.  We can work to understand your unique situation and goals and use our experience and expertise to help you put together an exit plan that truly fits your desires, meets your financial goals, and works in your desired timeline.  Get started to day! (contact me)