Most business owners know the exact value of their family home, yet they have no idea how much their business is worth (and this is the one asset that ensures the mortgage is being paid for every week).
Most New Zealand businesses have no Exit Strategy and a good few don’t even know it is actually possible to sell their business to free up capital to make retirement a real possibility!.
Here are 3 good reasons why you should consider having an Exit Strategy today;
- We don’t have a Crystal Ball. Most of us think we will never die. Probably because it hasn’t happened to us … yet. Like having a life Insurance policy, it would be good for your family to fall back on the sale of your business to have that extra income. “Things” happen in life while we are making plans for the future.
- You’ll be ready to sell when the time is right, often faster. Recently I sold a company called Frogprints. The owner started talking to me 2 years ago. At that time they were not ready to sell the business but we put simple plans and KPI’s in place. As a result, 18 months later we had an offer on the table within 4 weeks being on the market. Settlement was a month before Christmas.
- The process might increase the value of your business. A young man came to see me a couple of weeks ago. He wanted to franchise his start up. I spend 2 hours with him (free of charge), identifying his thought process. It turns out that franchising would be the worst possible way to grow his business. Had he not talked to us he would have franchised and build himself a business that needed his time and commitment for very little return, stuck with the obligations of being a franchisor.
To cut a long story short, you need a road map to get to the destination. If you want to get to Ayers Rock, you might need to know that you first need to get on a plane before you start driving the car from Sydney Airport. But you’d be surprised how far from Ayers Rock you’d end up by driving only 1 degree off your initial target; it’s a long way back from Darwin….
Are concerned about your Exit Strategy? Have a confidential discussion about your options today. I can provide you with a free appraisal to see what your business is worth in this economic climate.