Business owners spend years, sometimes decades, building their business. Yet when it comes to selling their business, many often do it without any real thought about what they really need and the effect upon them and their family.
The day-to-day pressures of running a business often means that personal financial planning drops to the bottom of the list or, even worse, off the list. However, failure to think about your own personal affairs early enough in the process can often leave gaping holes in your retirement.
Even the simplest question often has many business owners scratching their heads – what is an acceptable price to sell considering your expenditure needs once you retire?
The key to a successful sale, which should enable you to unlock the door to the next phase of your life, is to plan ahead. We recommend working with business owners for at least 2-3 years before they are planning to exit the business. This gives us the time to tidy up what they have put in place already and point it in the right direction. More importantly, it gives clients space and time to work out their number, the amount of money they need for the rest of their life.
It is with this understanding that business owners are able to review offers in a whole new light, with the amount they are looking for being specific and not simply an arbitrary amount.
Most importantly, having an early discussion about your number puts you in a stronger position to negotiate harder, wait for the right buyer and be less reliant on date of sale. This gives control of the situation back to you – which is a great place to be in and means that you can then concentrate on running the business more effectively.
If you would like to have a chat about what to do in the run-up to selling off your business, then please contact us and a Wealth Strategist can run through our approach with you.