Blog Library

Which Business Transition Strategy is Right for You? 

Posted by Jane Johnson on Mon, Mar, 19, 2018 @ 05:16 PM

An Overview of Business Ownership Transition Strategies

Owners often believe that when the time comes for them to retire, they’ll simply sell or pass on their business and move on to the next phase of their lives. The reality is it’s a complex process not an event. When considering selling options, owners typically focus on the financial considerations, often assuming that the higher the sales price, the more they will net – but that might not necessarily be the case – 30% to 50% of the sale proceeds could be consumed by taxes and fees. Thinking about selling to a third-party buyer? Did you know that only about 25% of businesses that go on the market actually sell? Or, maybe you want to pass your business on to your children. Did you know that less than one-third of family businesses survive the transition from first to second generation ownership?

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Topics: warren buffett, planning business transition, Free Business Transition Resources, business transition, internal business transition, external business transition, ESOP, selling my business to a third party

As a Business Owner, What Will Your Retirement Look Like?

Posted by Jane Johnson on Wed, Aug, 30, 2017 @ 01:01 PM

“In the end, it’s not the years in your life that count. It’s the life in your years.” ~ Abraham Lincoln

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Topics: business owner retirement, business transition, planning retirement, business owner planning retirement

Should I Consider an ESOP for My Business? Part 2

Posted by Jane Johnson on Wed, Apr, 05, 2017 @ 06:32 PM

In part 1 of our series on ESOPs (Employee Stock Ownership Plans), we discussed some of the basics of these plans, including some of the major benefits of this type of transaction for a business owner. During our recent webinar with ESOP attorney Tabitha Croscut, we delved further into some of the finer details of what ESOPs are, how they work, and what types of companies are good candidates for ESOPs.

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Topics: ESOP, Employee Stock Ownership Plan, due diligence when selling your business, business transition, business transition plan, business transition planning

6 Things You Should Do Now to Prepare for the Sale of your Business

Posted by Jane Johnson on Thu, Jan, 26, 2017 @ 07:47 PM

2016 was a hot year for small business sales – 7,842 transactions were closed in 2016, up 8.6% from 2015 and 4.6% from 2014, according to BizBuySell's 2016 Insight Report. According to the report, 2016 had the highest number of businesses changing hands since the report’s inception in 2007. Primary factors for the reported growth are attributed to an improving small business environment, more owners looking to sell, more qualified buyers on the market, and better financing options.

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Topics: business transition, business transfer, selling my business

Putting Together Your Business Transition Dream Team

Posted by Jane Johnson on Tue, Nov, 08, 2016 @ 03:03 PM

As an owner who is thinking about selling your business to a third party or transitioning the ownership to family or other insiders, it’s important to educate yourself about the process and work with professional advisors who specialize in business transfers and have the expertise to manage all facets of your transaction.

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Topics: business transition, Business transition team, selling my business, business planning

The Benefits of Partnering with a Business Transition Advisor

Posted by Jane Johnson on Sun, Oct, 23, 2016 @ 01:04 PM

A business transition is a complex process – whether you’re selling to an outside buyer or transferring your business internally. It takes a lot of careful planning and generally requires a number of years to be executed successfully.

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Topics: business transition, business transition advisor, selling a business, business transition plan

3 Common Financial Mistakes That Can Decrease the Value of a Business in the Eyes of a Buyer

Posted by Jane Johnson on Wed, May, 04, 2016 @ 04:13 PM

Most owners planning for retirement are dependent on the sale of their companies to provide the cash needed to finance the next phase of their lives. A substantial amount of wealth is trapped inside the illiquid asset that is their business. And the fact is that a majority of owners will have to boost the value of their businesses before they transition them to new owners or they will not net enough money from the transition, after taxes and fees, to fund the rest of their lives.

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Topics: business transition, selling your business, increase the value of your business, selling to an outsider, value of a business, planning for retirement, financial mistakes

Tips for Avoiding Common Retirement Challenges while Planning for Your Business Transition

Posted by Jane Johnson on Mon, Apr, 04, 2016 @ 05:46 PM

“No business task seems more difficult than slowly disengaging from the thing that gives you your identity, the clients you love, the routine you've established, and the team you've been integral to for many years.” This quote from an article in Journal of AccountancyRetirement: Avoid the pitfalls and plan for the possibilities” is so true and something that we come across frequently with the business owners we work with. Just as we discussed in When It’s Time to Step Away from Your Business, getting used to the idea of letting go or stepping away from your business may be the hardest thing for an owner to do.

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Topics: business transition, business owner retirement, exiting planning, planning business transition, business owner identity, step away from business, retirement challenges, Journal of Accountancy, planning for retirement

The Process of Selling Your Business to an External Buyer

Posted by Jane Johnson on Tue, Jan, 05, 2016 @ 09:30 AM

We’ve said it many times: Selling your business is a process! And, it can be long and arduous – 9-12 months or longer. Make no mistake, there will be a tremendous amount of work involved. The world of third-party transactions is a complex world and an expert “team” is needed to make your transaction a success. Your team should consist of key players, including an intermediary – a broker or investment banker who will help you sell -- and a number of other key advisors who should be involved in the process.

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Topics: Selling Your Business Externally, business transition, business transition planning, selling your business in 2016, process of selling a business

Understanding Your Buyer to Position Your Business in the Best Light

Posted by Kathy Richardson-Mauro on Mon, Dec, 14, 2015 @ 06:04 PM

The process of business transitioning is an art, not just a transaction. And by developing your business transition plan, you have the power to create the art. Once you’ve determined your goals, quantified your financial needs, improved your business value, and understand your options, the art is in how you manage the transaction to ensure a successful outcome. This involves understanding what different buyers are looking for so you may position your business in the best possible light. Here are some things you will need to do:

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Topics: business transition, business transition planning, selling your business, Understanding potential buyers for your business, positioning your business to sell, buyers for your business