12 Oct Around the Web: A Week in Summary
A recent article posted in the Bemidji Pioneer (MN) entitled “Pass it On: Putting the ‘Success’ in Business Succession” stresses the importance of being prepared when it comes to building a succession plan that works. Building a plan for continued business success through and after a transition of ownership, and actually following through with it, are essential factors that keep businesses alive.
Whether future success means improving internal technologies and pivoting toward a digital future or if it means keeping a business within the family, there’s a lot that a business owner can do to help improve their chances of success, or the successor’s chances of success, during a business transition.
A recent article from the Axial Forum entitled “Five Due Diligence Pitfalls and How to Avoid Them” outlines some common mistakes and pitfalls that are made during the due diligence process and gives tips on how to navigate the due diligence waters. The pitfalls include:
- Missed Opportunities
- Pointless Provisions
- Red Flags at the 11th Hour
- Poor Communication
- Leaving Money on the Table
Avoiding these five things won’t guarantee success, but doing so can definitely help give an owner the best chance at success. Buying a business is not an easy process, but knowing what to expect, what to avoid, and how to maximize the value of a dollar can go a long way.
A recent article posted on Entrepreneur.com entitled “Need Retirement Money? Selling Your Company Can Help. But First You Need to Plan.” explains the process by which a business owner can finance their retirement through the sale of their business. As with any business sale, adequate preparation is one of the most important aspects of this process. The following tips will help to ease the preparation process:
- Develop a retirement budget in today’s dollars
- Estimate any income you’ll have in retirement
- Calculate the required size of your retirement nest egg
- Consider the effect of inflation
- Take into account money saved
- Estimate the needed size and profitability of your business
These tips, along with all of the other typical business exit and succession preparations, are excellent ways to prepare for retirement through a business exit.