Business Exit Strategy
Plan a Viable Business Succession Strategy
Goal of succession planning is to determine how much you will need to net from the sale of the business to maintain your lifestyle and reach your long term objectives.
Whether you plan to sell your business or pass it onto a family member, having a plan ensures the continuity of the company’s success in the future.
A succession plan focuses on:
If you are considering a transition of your business to family member or key employee or want to sell the business outright, now is the time to start planning and preparing for the event. Having a succession plan also includes variables such as your retirement plan and financial management needs once the transition is complete.
Benefits of a Succession Plan
Create a Clear Vision
The goal is to maximize the enterprise value of your business or pave the way to a seamless transition to the next generation. Succession plans should be closely linked to your business strategy.
Simplify the Process
Help streamline a complicated and expensive process that requires diverse expertise that you may not have. It can take significant time and energy to accomplish.
Knowing in advance what will happen to the business when you exit, whether to retire or because of disability or death, results in an effortless transition between you and your successor. It will also help clarify the details within your company about how your exit will affect your employees.
Preserve Brand Reputation
Your company’s brand has been established over the life of the business that projects trust among your customers. A succession plan helps you protect that identity by ensuring that the person who replaces you upholds your company’s values.
When Should I Consider Selling My Business?
Selling your business is not a simple matter. Determining when to sell your business is difficult as there are a number of considerations that need to be made both on the business and personal side. On the personal side, if you are selling the business to retire, you need to understand whether or not the sale will net you enough money to live your preferred standard of living over the course of your lifetime. You need to build into the numbers the effects of taxes and the cost of selling the business.