There’s a lot to organise when you sell a business, questions to be answered, financials to finalise, decisions to be made.
But one of the biggest decisions is this: apart from money, obviously, what do YOU want from the sale of your business?
Are you hanging up your boots for good, taking on a new challenge, or will you continue to be involved with the business you are selling?
In other words, what are your exit strategies?
For the majority of people, once that particular business is sold, it’s on to pastures new, or the golf club! But for some, it’s a potentially difficult transition from owner to employee.
There are reasons why owners stay on after the sale. It might actually be part of the contract of sale. If your business is a complex one, and you are skilled in that area, the business might be bought by an investor on the understanding that you continue to run it.
In this case, not a lot changes on a day-to-day basis, but there is a major psychological shift, as you report to a new owner.
In other cases, the vendor might not demand that you stay on – but you might request it. You love your work but you just don’t want the responsibility and decision-making any more. Or you’re just not ready for retirement.
However, in both cases, it’s wise to have an exit strategy.
Let’s just say, a few months into the arrangement, you’re not happy. You feel uncomfortable with the new corporate culture, and the way in which ‘your’ business is changing. Change was to be expected, of course, but you thought you’d handle it better.
Worse still, the new owners approach you because they don’t feel the situation is working out.
If you have an exit strategy in place, removing yourself from this difficult situation will be much easier.
Another scenario might be that the new owner wants you to stay – but you want out! There are two exit strategies here. You can decline the offer but, not wanting to lose the sale, offer to train a staff member to take over that role. Or you can agree to stay on as a consultant.
Worryingly, the Commonwealth Bank Local Business Owner Report found that only 47% of small business owners have an exit strategy. 22% of those who do have an exit plan simply intend to close their doors and walk away. 60% are still actively reinvesting profits back into their businesses and half are working more than 50 hours a week, even if the business will close.
One in four business owners aged over 60 are planning to close their businesses at retirement.
If you are serious about selling – and leaving – you actually need to make yourself redundant well before the changeover. You don’t have to physically leave ahead of time, of course, but the business should, by then, be running very smoothly without you.
For SMB owners, this can be quite a challenge. They are so used to doing everything themselves, it can be hard to cut the cord.
But advice is at hand. List your business to sell privately with Coast to Coast Media, and you’ll not only have access to the very best selling tools, but you’ll end up with more money in YOUR pocket.
This long established, Australian-owned company never charges commission.
With experience built up over many years, over many hundreds of businesses, these guys can help you come up with the best exit strategy for your business.