Submitted by Pam Hargis
The Importance of Proper Business Exit Planning.
If you don’t plan your exit, someone else will — and chances are, you won’t like their plan.
Think about it: your business is likely your biggest asset, the result of years (or decades!) of hard work, late nights, and maybe a few too many cups of coffee.
Waiting until the last minute to plan your exit is like cramming for an exam at 3 AM — technically possible… but let’s just say the results won’t be pretty.
Could YOU be losing 75% of your business's value?
Without proper planning, the answer might be a hard yes!
The sale or transition of a business will likely be the single largest and most important financial transaction of a business owner’s life………and its level of success will impact the rest of their life in retirement.
Mapping out a successful plan to exit the business can help business owners:
-Avoid unnecessary or excessive taxes
-Minimize risk during the transition
-Realize the full value of their life’s work
In recent years, only 20 to 30% of businesses listed for sale ended up being sold……And many of them did not sell for what the owners initially thought they were worth.
The key to exit planning is that it isn’t actually about the exit itself…it’s about the planning for the exit…the staging process that leads to a happy ending for the business owner, bringing them maximum value for the business when it’s sold.
KEY STATISTICS TO CONSIDER – 2016 EXIT PLANNING INSTITUTE (EPI) SURVEY RESULTS
-63% of private U.S. businesses are currently owned by Baby Boomers
-The average age of Baby Boomers is now 60 years old
-80-90% of their wealth is tied up in their businesses
-76% will transition these businesses within 10 years, 48% within 5 years
-4.5 million businesses...$10 trillion of wealth...to be transitioned/exited in the next 10 years
-76% of those owners aren’t aware of or don’t understand their transition options
-88% do not have a formal transition team in place
-86% have no formal education or training related to business transition
-50% have no plans regarding what they’ll do post-business transition/exit
CLEAR MESSAGE…There is a HUGE need for business exit planning and education with business owners, their families, and team.
Need a guide for your exit journey?
Reach out to:
Pam Hargis
Certified Business & Executive Master Accountability & Growth Coach
386-847-8028
LinkedIn
phargis@focalpointcoaching.
pamhargis.
