Fall certainly made its presence clear this past weekend! But did you know that many meteorologists recognize September 1 as the first day of fall? If you are like me, you probably lie in the camp of astrologists who recognized the fall equinox on September 22. Kids are back at school, the leaves are beginning to show their true colors and the temperatures are cooling off.
Either way, I am not ready for fall – are you? I hate that the days are getting shorter and that I didn’t get to do all the things I wanted to do this summer, but unfortunately, you can’t stop time.
Fall is a great time to do some of the important tasks that didn’t get taken care of during the summer because of summer’s wonderful distractions. It is also a great time to look ahead and start thinking about next year, what you want to do differently both personally and in your business.
Over the past couple of months I have introduced you to my Transition RoadMap® and Stages 1 through 3. If you missed these newsletters you can read them here.
The Transition RoadMap® is specifically designed to help you begin thinking about your business as an outside investor would. Whether you are looking to sell your business or just want to enhance value, the Transition RoadMap® should be part of your overall business strategy.You will learn how to align your personal, business and financial goals in order to maximize and extract value from your business whether currently, as income, or down the road in the form of the sale.
Who wouldn’t want to do that?
Planning a transition from your business can sometimes feel like a solar eclipse – being in the dark! With the help of my I work with business owners to find the right path to their successful transition.
Up until this point in the Transition RoadMap®, we have identified your personal, business and financial goals, determined the value of your business, taken steps to protect what you already have, and taken steps to maximize the value of your business by de-risking your business and implementing value-enhancing strategies. You are now ready for the final two stages:
Stage 4: Preparing for Departure
Stage 5: Arriving at your Destination
The final two stages of the Transition RoadMap® are designed to help you further understand your options and emphasize the management and preservation of what you have. Let’s take a look at the last two stages.
Let’s take a closer look at the last two stages.
Stage 4: Preparing for Your Departure
Building on the information gathered in Stages 1 through 3, you can now review what you have accomplished towards meeting your business, financial, and personal goals.
Have you met these goals? Is there more work to be done to get where you want to go? Has the value of the business been enhanced?
Stage 4 focuses on these important questions and when you can decide where you are now, which looks something like this:
Still Work to Be Done – more needs do to be done to enhance the value of your business and meet your goals.
Life is Good – met business, personal and financial goals, but you love your business and want to keep extracting income.
Ready, Set, Go! – you are ready to transition from your business.
Stage 4 is all about choices. Yes, you have a choice!
This is where you too can adjust your sails. If you feel there is still work to be done and you want to continue value enhancement strategies. No problem!
Simply keep working on your business and goals (repeating stages 1 through 3).
Or, maybe you have had a change of heart and no longer want to sell the business. You have successfully implemented some strategic changes in your business that allow the business to run without you (yes, it can happen) and want to “collect a paycheck” for a few more years and work on your business instead of in it. That is great!
Finally, for those who truly want to (and are truly ready to) transition from their business – you can!
If this is your course, then we will take a look at the various options you have for transition. While the options will have been discussed in earlier stages to get a feel for what you think you want to do – sell to the third party (management or outside buyer), transfer to family, or liquidate – now we take a hard look at the tax and financial implications of each option. And, depending on your chosen exit strategy, we can assist in due diligence preparation, business broker or investment banker selection, as well as making sure you are staying on task.
We're there for you from first negotiations through the signing of the paperwork!
Stage 5: Arriving at Your Destination!
You have made it and arrived at your final destination – as you have defined it. But wait, there is more?
Yes, no matter what your “map” to this destination looks like, you need to understand the importance of managing and preserving your wealth via continued financial/estate planning and asset protection.
In this stage, we work with your financial advisors, estate planning attorney and CPA to look at the post-transaction situation and make appropriate recommendations and adjustments to your overall personal and financial objectives. Maybe you’ll even decide on another business adventure. Who knows?
In Summary
When it comes to transitioning from your business, a well thought out Transition RoadMap® will make the process easier, provide peace of mind, and help you maximize the value of your business. Based on the Exit Planning Institute's 2016 “State of Owner Readiness®” survey, 3 out of 4 business owners surveyed “profoundly regretted” the decision to sell their business 12 months after selling.
Will you be one of them? Or will you take the steps to be the 1 out of 4 that developed a plan and has no regrets? The choice is yours.
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!
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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.