Most business owners haven’t thought about what they would IDEALLY like to do with their business once that owner decides to move on. (Wait, if your business is small, or new, don’t assume this doesn’t apply to you, because it does!)
How about you? Think about it. Under what circumstances would you like to walk out of the business, take one look back and think to yourself, “It was a hell of a good ride!”?
Over 60% of business owners plan to sell the business and use the proceeds to fund their retirement. Others want to sell to start a new business.
Few think about the options if that business doesn’t sell. Wow, that’s grim.
On the other hand, if you are five to ten years out from wanting to sell, then you have time to build value within your business. If you tell me that you don’t have time, you’ll get to that later, or when the time is right – I’m going to call you out on that kind of thinking.
Selling your business is a process that you can start preparing for on Day 1.
Here’s what I mean: Day One:
- You can hire an attorney that is a business attorney with startup experience as well as experience in selling companies.
- You can hire an accountant with experience at both ends of the business spectrum – startup to the sale.
- Develop a culture that is based on your vision, mission, values and purpose. Make it easy for everyone who joins you to become an ambassador for the company’s mission.
Day 1,825: If you’ve been in business for a while, you have the chance to take these steps to prepare:
- Take inventory. Identify anything that is obsolete and sell it or give it away.
- Examine your accounts payable and receivables. Receivables over 90 days are considered a loss by a prospective buyer. Collect and revise the terms and conditions.
- Assess your organizational structure. Study the flow of work, decisions, and innovations. Explore bottlenecks; these undermine the value of the business.
Day 9,125: Let’s say you’re getting to the point that you want to exit in the next 1-2 years. You’d want to take these steps:
- Develop a relationship with a trusted business broker or investment banker.
- Get a Broker’s Opinion of Value or a Business Appraisal or a certified valuation.
- Consult your financial planner and your accountant to discuss the tax implications as well as the impact of each exit option on your financial future.
This is the kind of preparation that can be done from Day 1. Make the time to give you and your company the support to build a viable, sustainable business that becomes an asset in your portfolio.
Make the time. Later is too late. The time is right.
I’m happy to provide a free 30 minute consult to help you come up with the steps that make sense for you and your company at this time to build value within your business. Schedule with me here.
P.S. The Photo is a Zoom meeting earlier this week of the CEO Services Power Team. Each person here is my go-to for clients. From left to right, top to bottom: Jeff Miller of Sales Recruiters of VA, me facilitating this Power Team, Randy Asbell of Selling Forensics, Mick Wienholt of Schooley Mitchell, David Kalman of S.L. Nusbaum, Gus Iurillo of The Entrepreneurs Source, Mike Metzger of Murphy Business Sales, and Scott Simmons of Simmons Law. Message me if you’d like their contact information.