If you’re thinking of selling your business, then you will know that it is not often an easy decision. The difference between what your heart and head tell you can often cloud your decision making.
Just like running your business, selling it requires you to wear many different hats and spin a few plates.
There may be a number of reasons you want to sell:
- You want to retire
- The business has become too big for you to run
- You’re tired of running it and want to take more of a backseat
- You want the proceeds to help seed a new venture.
Whatever your situation as Financial Life Planners we are here to remind you that money is just a tool to help live the life you want. The earlier you plan the better it is for your personal financial wellbeing.
Follow these 3 key steps to make sure you don’t drop any plates along the way:
Timing – it can typically take anywhere between 12-24 months to conclude a sale. Planning ahead is crucial to ensure that the business is well prepared, marketed to the right potential buyers, and for the due diligence process and transaction to complete.
Selling your business may not be your only option, a family takeover or management buyout could be on the table.
Alongside this, it is vital to consider your personal financial plan and this is usually determined by the net value of your business to you.
Which brings us on to Step 2:
The amount you truly need is more important than the offer.
Working with professionals early on can help provide a guide based on a number of industry standard methodologies or a bespoke value based on your specific set of circumstances.
Negotiation is inevitable as buyers and sellers often have different amounts in mind. But how much is enough?
Of course, you would like to maximise the value but keep in mind your financial freedom is not necessarily linked to this number. We can help you to know ‘your number’.
Knowing your number is Step 3:
Your Financial Plan
By understanding your vision for the future we can show you what you can (and can’t) do financially after the sale. This will put any offers you receive into context.
If the next phase of life is retirement this is particularly important because the two biggest resources you have at your disposable are Time and Money. If you’re holding out for some arbitrary amount that may never arrive this will be at the cost of time spent enjoying retirement.
You would end up selling the best remaining years of your life for money that you don’t even need to live your best life!
Our holistic financial planning service will help you to:
- Navigate this next phase of life with your wellbeing intact
- Make sure taxes are kept to a minimum
- Understand options in respect of any commercial property
- Manage your money in line with your goals
Let us know, what are your biggest concerns if you are thinking of selling your business?