Can you believe that July is nearly over and August is just around the corner? (editor's note: seriously!?)
Wow, where is the summer going? I had so many plans for the summer and it always seems that I never can fit it all in. I have many “excuses” as to why I haven’t done all the things I wanted to do, but let’s face it – I just didn’t make them a priority. I thought about this a lot this past weekend as we spent a long weekend in the Steamboat area on our annual family camping trip.
It was a great time to unwind, unplug and enjoy time with family in the great outdoors. I love camping – the fresh air, the great food cooked outdoors, the smell of pine, the campfire and the millions of stars visible. So much to be grateful for! It is also a great time to reflect, without distractions of email and phone calls on life, my priorities, and planning out the rest of the year.
What do you do to get away and spend quality time to reflect? When was the last time you did?
Your Business Transition Questions Answered: The Transition Roadmap®
Last month I talked about the how having a little help from your friends or a Certified Exit Planning Advisor (CEPA) can be helpful preparing for exiting your business and I told you we would discuss this month what is involved in developing your personalized Transition RoadMap®. It was on a similar camping trip that I began formulating the Transition RoadMap®. I was thinking (and talking out loud) -
“How can I easily explain the transition planning process to clients and colleagues?”
I had given a lot of thought to my business name: “Encompass Transition Solutions” and decided to play off the “compass” and my tagline, “Helping business owners navigate change.” ...and I came up with the concept of the Transition RoadMap®.
“That is it”, I thought! Transition planning is like planning a trip and thus the five stage Transition RoadMap® was formulated.
The Transition RoadMap® is specifically designed to help you begin thinking about your business as an outside investor would. You will learn how to align your personal, business and financial goals in order to maximize and extract value from your business. The Transition RoadMap® consists of a series of five stages, each with a specific objective in mind.
Stage 1: Developing Your Itinerary
Stage 2: Preparing for Your Journey - Coming Next Month, Stay Tuned!
Stage 3: Mapping Your Strategies for Success - Coming Next Month, Stay Tuned!
Stage 4: Preparing for Departure - Coming Soon!
Stage 5: Arriving at Your Destination - Coming Soon!
Transition RoadMap®: A Closer Look - Stage 1
The beauty of the Transition RoadMap® is that each stage builds upon the previous one and is specifically tailored to the needs of the business and business owner. It is like planning a trip and should be part of your overall businesses strategy, not just something you decide to do “one day” because you want out.
It is unlikely that you started your business without a plan. You had a road map when you started, why not continue that road map in the future?
Let’s take a look at Stage 1: Developing your Itinerary –
In order to know where you are going you need to know first where you are today. With that in mind, the objective of Stage 1 is to help you know and understand the value of your business today and how that plays an important part in the success of your transition from your business. This is done by conducting an in-depth interview and with you and performing a business valuation in order to
gain a clear understanding of the business,
discuss and establish your business, personal and financial goals,
establish the value of your business, and
review financial planning and retirement needs with your advisors
For many business owners, the value of their business can represent a majority of their personal wealth, yet they have no idea what the business is really worth.
Would you feel comfortable not knowing the real value of your investment portfolio? Of course not, so why would you not know the value of your business?
Having your business valued is an important first step in transition planning, and for that matter, should be part of your overall business strategy. The goal of the business valuation is not only to estimate the fair market value of your business today, but also a good way to gain a clear understanding of the business, identify opportunities for value enhancement and what drives value in your business but it also provides accurate information for your financial planning and retirement needs. Information gleaned from the business valuation is leveraged and used extensively in order to ensure a good return on your investment.
If you don’t know where you are today, it is hard to develop an itinerary.
For example, you wouldn’t book a flight from San Francisco to LA if you didn’t know when you would be in San Francisco – right? Don’t wait to start developing your itinerary, you may find that you aren’t prepared (think about the last time you had to leave town on an emergency – how unprepared and perhaps unsettled you felt) and know that having an itinerary will make “traveling” easier.
You have spent years working hard in your business and building the business to what it is today. Wouldn’t you prefer to maximize and extract all the value you can from your business? Ready to get started? Email me or call me at 970-389-4802 for a free initial consultation and let’s get to work on your Transition Roadmap®.
Stay Tuned!
Next month we will look at Stages 2 and 3 in the Transition RoadMap®. Have a great month!
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Welcome to ETS Compass, my personal newsletter. My goal is to provide useful and purposeful information to you that will help you navigate change in your business, whether transitioning from your business or needing to increase your business value.
If you would like to read my prior newsletter(s), visit my blog page for this and prior issues.
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.