With certainty, every business owner will one day exit his or her business. When will your exit occur? How will it play out? Will the business sell to the highest bidder or will you retire and hand over your business legacy to your family?
For some puzzling reason, exiting the business never gets the attention that starting the business did. Yet leaving the business usually represents the most significant financial event an owner will experience. According to the Exit Planning Institute, “…as many as 75% of all business owners are afflicted with the no-exit plan disease” – an interesting statistic because most business owners are planners who don’t like surprises, preferring to act, not react. Defining an exit plan not only means preparing for the unexpected – including hardship, injury, disability and even death – it also means having an ideal and orderly scenario for ownership transfer when you decide it’s time.
For the business owner who concludes the best exit plan is to sell the business, a question often asked is, “What is the value of my business?” Because the amount you receive will likely define the future financial stability for yourself and your heirs, having a clear understanding of the value drivers and identifying the value detractors are both key factors in preparing your business to be sold. In this way, regardless of the circumstances that bring about a sale, you will likely obtain a greater value for your company.
Whether you are thinking of selling now or later, it’s prudent to set about preparing your business to be sold. The first step on this path is to benchmark the market value of your business. For many business owners, this is an “eye-opening” event for identifying factors to be addressed that will increase the value of the business and its attractiveness to potential buyers. Armed with this business value knowledge you are then ready for the next step toward the outcome you intend.
For additional information and to further explore this topic, visit the Kingsley Group website www.kingsleybrokers.com, as well as communicate with Tim directly by phone (417) 889-9400, or email to: [email protected]