22 Jul Top 10 Exit Planning Mistakes
1. Bad timing – judging the best time to sell is important to maximise the price received, e.g. when the business is doing well or when there is strong demand as there is at present.
2. Being reactive – waiting for the perfect deal is like waiting to win Lotto – it is highly unlikely. Better to be pro-active when the time comes and have the business marketed professionally.
3. Not considering all your options – a sale to staff? A sale to a competitor who has synergies? Bring in a junior partner so you ease out?
4. Being distracted – do what you do best – run the company. Let the professionals market your business and negotiate the best deal.
5. Not knowing your value – what is your business worth now? Have you realistic expectations and will that provide enough for your next project?
6. Where to next? – an important part of exit planning is answering that question. Another business? Retirement – and all the issues associated with that?
7. Tax implications? – your accountant should be part of your team implementing your exit plan and protecting you.
8. It’s not a DIY project! – to ensure the best result ensure you hire an experienced business broker with the expertise, resources, and marketing skills to explore all your options and attract the best buyers.
9. It takes time – selling a business is much more complex than selling a house so allow plenty of time. Full information has to be assembled, multi-pronged marketing strategies need to be implemented, legislative and tax implications need to be understood, and almost certainly there will be unexpected roadblocks and challenges before settlement.
10. KISS! – do not get overwhelmed with the task ahead. If you have an experienced team handling the process they will smooth the way and sort the problems.
– with thanks to Tom West and Russ Robb