How to Develop a Succession Plan for Your Small Business?
Our 21 step Business Succession and Exit Planning process has been designed and developed over 10 years to help business owners maximise the value of their business and achieve a successful exit.
Most, importantly – you need to begin with the end in mind – know and understand exactly where you want to get to – what is your exit strategy? When do you want to sell? How much money do you need to retire? Who will run the business after you leave? Is there a strategic buyer for your business? What will you do after you exit?
The five stages we use in our process are important milestones – and they are all focused on VALUE:
Identify Value – What do you actually have? What is it worth? is it possible to sell? what are the key issues and risks within the business?
Protect Value – Making sure that you minimise risk, protect your assets, document what you would like to happen if an unplanned event (serious illness, accident) occurs?
Maximise Value – How do you make sure the business is not dependent on you? How do you lock in retain and motivate team, please? How do you set up a corporate governance structure to manage the business and guide decision-making and strategy? What sales and marketing plan do you have to generate ongoing leads while you’re in bed asleep? How does your business and financial model maximise value and get you closer to your exit goal?
Extract Value – Having done all the preparation the way that you sell the business (through buyer research not through broker style advertising) and who you sell to (a strategic buyer) will ensure that you extract maximum value from your business as part of the process. Managing the transaction, the due diligence process, the legal contracts and the warranties and securities you need to provide are also important aspects – the terms of sale are often as important as the price.
Manage value – Once you have sold the business and are heading towards retirement, you need to make sure you are holding assets in the correct entities for asset protection tax minimisation and long-term wealth management. It’s also time to review your estate planning and ensure you have people you know and trust managing your affairs going forward.
When done properly this five-stage, 21 step approach will ensure a successful exit outcome at maximum value with assets protected and the business having the best chance possible to succeed after you exit.
Ready to implement the 21 step process for your small business?
Click here to contact us today and book an obligation-free 30-minute appointment with a Succession Plus adviser to see how we can help you and your business.