This past weekend we celebrated Father’s Day with my dad and family members. It was great to slow down and celebrate the wonderful dads in my life and I hope you were able to do the same. My dad taught me much in life (the value of the dollar, a strong work ethic), gave me a moral compass to navigate with, and that nothing is stronger than family, love, and laughter.
If you are like me, you have had influential individuals in your life that provided guidance and coaching. Whether they be dads (or moms), teachers, religious leaders, coaches, mentors or friends that you could confide in; they directly or indirectly shaped us into the people we are today.
Who were those people most influential in your life and how did they influence you?
Meet Your New Business Transition Mentor
Let’s face it: there are times that...well...we just need a little help from our friends. You may be facing a big decision; exit planning for your business, for one example. You likely have many questions about exiting your business:
Where do I begin?
When is the right time to exit my business?
Will I get enough money for my business?
What do I do if my business isn't worth as much as I thought?
What are the tax implications?
How do I ensure I take care of my family and/or my employees?
Do I have enough money saved for retirement?
What will I do after I transition out of my business?
The best way to deal with these concerns is to develop a strategic transition plan that meets your business, personal, and financial goals identifies needs and opportunities and maximizes the value of your business. To ensure a smooth, successful transition from your business consider enlisting the help of a Certified Exit Planning Advisor (CEPA).
What is a Certified Exit Planning Advisor (CEPA)?
A CEPA is a credentialed professional who has completed the comprehensive training of the Exit Planning Institute, passed a proctored 4-hour exam, have a least five years of experience in working with business owners and must abide by a strict code of ethical conduct.
What can I expect from a CEPA?
You can expect a professional advisor that focuses on you, the business owner. Through a series of discussions and questions a CEPA will help you determine personal and business goals, financial needs, business value, tolerance for risk, and transition time frame. That, in turn, will drive the development of a transition plan developed specifically for you and your goals.
How much will it cost?
CEPA’s are compensated in different ways; flat fee, hourly or a combination of both. Your CEPA will provide you with the pricing for your specific situation in a written engagement letter upfront.
DON'T select your advisor based on price, alone. Enlisting the help of a CEPA to develop your transition plan should not be taken lightly. Make sure they have the experience, have high professional standards, and are committed to you, the business owner.
DO expect to make a commitment of time and money when working with a CEPA. Doing so will bring you peace of mind, ensure you are well prepared, and maximize the value of your business.
What's Your "State of Owner Readiness?"
You have spent years working hard in your business and building the business to what it is today. For many business owners, their business comprises 80-90% of their personal wealth. And yet, according to the Exit Planning Institute 2016 “State of Owner Readiness” survey:
85% had no board of advisors
76% were not sure or did not know what their exit planning options were
88% had not established a business transition advisory team
86% had no formal training on transitioning from their business
How about you? Where do you fit into the survey results?
Surprisingly, the survey also indicated that 76% of these owners plan to exit their businesses within the next 10 years and 48% within the next 5 years.
Historically,
75% of business owners who sold their businesses, regretted doing so
70% to 80% of business put on the market to sell, DON’T SELL!
30% of business transferred to a second generation survive; 12% to a third generation and only 3% to the fourth generation and beyond.
Why?
In many cases, there was no clear business transition exit plan.
Will you be one of the statistics or will you be proactive and take your future into your hands?
The choice is yours. But you must be proactive, not reactive. Developing a successful exit plan takes time.
If it is time for your new beginning, then let’s get started!
Together we will establish a roadmap, with a purpose, picture, exit plan, and part - for YOU!
Next month we will discuss what is involved in developing your personalized Transition Roadmap®.
Have a great month!
Don't want to miss the next issue? Get my newsletter ETS Compass right in your in box.
ETS Compass is my personal newsletter that provides thought-provoking topics and helpful guidance to business owners looking to navigate change in their businesses. Whether it is value enhancement or transition planning, it is my goal to educate you.
My goal is to provide useful and purposeful information to you that may help you transition from your business.
Author: Sheryl Brake
Sheryl is the CEO and Founder of Encompass Transition Solutions, LLC and former partner of a top 25 national accounting firm. She has been working with business owners in a wide variety of capacities for more than 30 years. Sheryl lives in her home state of Colorado with her husband, Michael.