How many times have I been asked by someone who wants to sell his or her business, “Is it too early to begin an exit plan?”
I always say, “Heck no. It’s never too early.” That is the truth that you probably don’t want to hear.
The buyer’s time frame might align with the seller, but more often it doesn’t. So you have to give a little. You may need to stay on to help the new owners ensure that your transition out of the company is smooth. Most new owners love the original owner who is willing to stay. This ensures continuity because of the benefits, expertise, and experience the original owner can bring. The employees, customers, suppliers and revenue will remain stable.
However, bad stories can happen to very good people. So, in order to make sure that you can sell successfully, you need to know that there is a likelihood of a positive outcome. It goes along with the decision to sell, which I talked about in the previous chapter. You must make that decision. You must realize that you need a plan. You will need to hire experts who can help you maximize value and mitigate risks. When you do that, you won’t suffer the potential negative outcome of not planning.
Buyers will come in prepared. They will have done their due dil- igence. This means that they will have examined your books. They will understand how your business is run. You, the business owner who wants to sell, needs to do that same. You need to be prepared. Sellers are surprised and say, “You have to get that micro?” Yes, believe me, the buyers will go that micro.
Work on your business so that you can give your buyer informed answers instead of just winging it. Winging it won’t get your business sold. You need to get all of your ducks in a row.
One of my favorite stories is about a husband-and-wife team who knew that the time they spent working on their business was pure love. Here’s where the magic happened.
It was October 2017. This business was doing about $5 million in sales. They were masters at landscaping and snow removal. They had also created an offshoot business where they sold the salt needed to keep the walkways and streets clear in front of businesses and homes. This allowed them to keep the supply of this very important ingredient internal to the company. It was also a separate source of revenue.
However, they were getting tired of the grind. They wanted to get out while they could still travel and enjoy a lifestyle that they had always wanted, but never had the time to do it. Does that sound familiar?
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