Certified Exit Planning Advisor Andrea Brady, a shareholder with Concannon Miller, was quoted in a recent Lehigh Valley Business article about the factors at stake in a successful business sale. Check out her insight and advice below:
While it’s never too early to consider an exit plan, Andrea Brady said many clients she works with get serious within two to five years of selling and exiting the workplace.
Brady is a certified public accountant and shareholder of Concannon Miller in Hanover Township, Northampton County.
She said a sobering survey by the Exit Planning Institute found that “two thirds of business owners don’t know their exit options, 78 percent don’t have a transition team, 83 percent have not written a transition plan, and 49 percent have no plan at all.”
Business owners also must balance personal and outside factors when deciding when or whether to sell.
“Market conditions, personal health, an unsolicited offer from a competitor, death of a family member or partner, winning or losing a major contract or customer. Be prepared to capitalize on these factors rather than react to them,” she said.
Upfront preparation should include a business and books house cleaning to get affairs in order. Having a third-party valuation goes a long way to setting realistic sale expectations as well, Brady noted.
“The biggest mistake most owners make is thinking the business is worth more than it actually is,” Brady said.
She said business owners often think more sales equals more value. But that’s not always true. Instead, look to differentiate the business in its market with a product or service that is attractive to another company.
Standing apart from the pack does add value, as does having “runway” where there is still plenty of room for growth.
Read the full article here: Exit stage right: Many factors feed into a successful business sale