Exit Planning is a crucial element for every business owner, yet unfortunately many don’t give it enough attention… until it’s too late.
Exit planning is defined as the creation and execution of a strategy allowing owners to exit their businesses on their terms and conditions. It is an established process that creates a written roadmap or Exit Plan, involving efforts of several professions facilitated and led by an Exit Planning advisor who ensures not only the plan creation, but its timely execution.
Did you know that about 60 percent of privately owned businesses are owned by baby boomers and according to the Business Enterprise Institute, just above 800,000 firms have a value between $5 million and $200 million? While there are as many different plans as there are businesses, for most owners there are only 7 exit options.
The reality is that most business owners routinely focus on one exit option that they believe is the “right one” without having full knowledge or consideration of the others. A quality exit plan should consider all 7 options to determine what the best fit is, and what the expectations might be if pursued. The options include:
- Sale to a third party
- Sale to a key employee
- Sale to family
- Gift to family
Every business is different, and each owner has a unique perspective and situation that will affect the best solution. We help our clients evaluate their options in light of their corporate structure, desired outcome and retirement income needs. These factors can play a major role in determining the best exit planning path for you.