29 Jun Around the Web: A Week in Summary
The following information has been sourced by Business Brokerage Press for the benefit of the business brokerage community. The views of these articles do not necessarily represent the views of Business Brokerage Press. We hope you find this information helpful.
A recent article from Forbes entitled “15 Ways Retiring Business Owners Can Protect Themselves And Their Families” offers helpful advice for business owners as they plan for retirement. The sale of their business is significant, but it’s not everything. It’s important to thoroughly check all of the boxes prior to retiring.
Consider the following tips:
- Develop An Exit Strategy In Advance
- Set Up A Diverse Portfolio Prior To Retirement
- Make Sure You Can Afford Retirement
- Don’t Rely Solely On Income From Selling The Business
- Contribute To A Small Business Retirement Account
- Ensure You’re Entering Retirement With A Good Credit Score
- Have A Plan To Pay Expenses Previously Covered By The Business
- Retain Outside Counsel
- Include Indemnification In Transfer Contracts
- Work With A Family Office
- Create An Updated Estate Plan
- Draft A Thorough Transition Plan
- Protect Principal Equity
- Have A Sufficient Will And Adequate Insurance
- Make Contingency Plans
A recent article from Investor’s Business Daily entitled “Startup Success Hinges On Knowing When To Sell” discusses the value of developing an exit strategy early on in the life of your business. With early exit planning, a business owner can control the fate of the business, maximize profits, and minimize risks.
For a successful exit plan, consider the following:
- Utilize your goals and values to guide the exit in a direction that works for you
- Identify your vision, mission, principles, objectives, and strategy which will help determine when to sell and who to sell to
- Build strong strategic relationships to help the business succeed and to develop potential buyer candidates
- Get the sales revenue rolling early on and prioritize profitability
- Develop multiple sale options and alternatives so that you have leverage
A recent article from Allan Taylor & Co. entitled “How to Tell Employees You Are Selling the Business” tackles the difficult question of when you should tell your employees that you are selling the business. Every business and situation is different, but it is important to get this right to protect the deal, the business, the buyer, the employees, and yourself.
In general, it’s usually recommended not to tell any employees until the deal has closed. However there may be a key employee who you wish to inform sooner. In some scenarios, the owner may actually need the help of a key employee to accomplish certain sale tasks such as pre-sale preparation, on-site visits and due diligence. Again, every situation is different.
When it comes time to tell your employees, you will need to consider whether you wish to tell them by yourself or with the buyer. It is important to convey to them what level of involvement you will have after the sale as well so that they feel comfortable and willing to remain on board.