One thing is certain about the relationship with your small business: One day in the future will be the last in your business. Write this on a rock…Are you making plans for that last day?
If you are a small business person, what will your last day at work be like? More to the point, what will your last day at work mean to the business you created? The answer hinges on whether your exit will be by design or by default.
To exit your business by design requires coordinating your personal estate with the estate of the business. Oftentimes the two are intertwined. Ask yourself the question recently posed in the title of a recent Forbes article: “How Will You Leave Your Small Business The Last Time?”
Will you sell it? Apparently as many as a third of business owners surveyed by the author planned to do so. However, the business brokerage industry reports a successful sales record of not much more than 20%.
Going to pass it on to the next generation? Some 14% of survey respondents said they were, but only roughly 30% of family businesses actually continue to the next generation.
In either case, the numbers simply do not add up well for casual business exit planning.
Just as you have worked hard to build your business, it seems you will need to work hard to successfully leave it. Accordingly, plan now for that last day or risk losing your investment by default.
Reference: Forbes (November 4, 2013) “How Will You Leave Your Small Business The Last Time?”