We’ve all heard of buyer’s remorse, but do you know about, “seller’s remorse”? This is a phenomenon that we frequently come across when business owners have not personally or financially prepared themselves for the sale of their businesses.
Prior to selling their businesses, most owners probably wouldn’t even consider that they might feel this way once the deal is done. In fact, euphoria, exhilaration, and relief are probably closer to what you would expect to be feeling, certainly not remorse! What could you possibly be sorry for, feel guilty about, or regret? After all, this is the day you’ve long been waiting for, anticipating the way life will be once you’ve sold your company, moved on, and started to finally enjoy your long-awaited next phase of life.
What is seller’s remorse?
Although seller’s remorse is a commonly used term (we also see it used following real estate transactions), seller’s dissatisfaction may better describe the situation for many business owners when they sell their company. It more clearly defines what owners are actually feeling. Here are some of the common disappointments we have heard from business owners:
- I thought I would get a better price after all my years of hard work.
- I had no idea I would pay so much in taxes and fees and net so little.
- I thought they would keep my key employees.
- I never thought they would move the business.
- I thought they would keep me on longer as a consultant; I wanted to stay involved.
- I am not enjoying retirement as much as I thought I would…I waited so long.
- I thought I would have enough money to live the life I wanted...but I don’t.
- I never thought I would miss going to the office… but I do.
- I never thought they would radically change the company…but they did.
- I never knew I had other sale or transition options.
These disappointments, disillusionment, and dissatisfaction can all lead to feelings of remorse, triggering self-blame and guilt. An owner may feel ultimately responsible when the sale has negatively impacted their family, their employees, or the community. You may feel like you should have known more, been better prepared, and been able to better control the outcomes. Unfortunately, you rarely get a second chance. The sale of a business is not a dress rehearsal; you usually get one opportunity in a lifetime.
What can you do to avoid seller’s remorse?
Seller’s remorse is very real, and can very easily happen if you’re not properly prepared for the process of selling your business. There are distinct steps owners can take to avoid these regrets and disappointments:
- Educate yourself and be properly prepared for the eventual transition.
- Identify your personal and financial goals and objectives.
- Allow sufficient time, usually 3‒5 years, for the sale of your business.
- Know your transition options and the pros and cons of each.
- Be proactive; don’t procrastinate!
Most, if not all, of the disappointments on the list above can be avoided with proper exit planning and the development of Business Ownership Transition Plan – a process of holistic, comprehensive, specialized planning and the guidance of seasoned exit planning advisors.
The next phase of life can be what owners envision, a life filled with excitement and the fulfillment of lifelong dreams and goals. The best years of your life need not be spent wishing you could have achieved a different outcome with the sale of your company. Sadly, many owners will unnecessarily experience disappointment and remorse. The choice is ultimately yours. It’s our mission to empower and educate business owners, enabling you to achieve your optimum exit from your business and keep you from experiencing seller’s remorse.