You may have heard someone say, "I'm going to sell my business in 3 years." If the business owner is serious, they should hire an advisor and get started now. The process alone could take 3 years.

Long-Term Exit Planning

The Intelligent Approach

If you plan to sell your business in 3 years, now is the time to get going. Too many business owners wait until the last minute and are then disappointed by the results. Below are some tips that will help.

Retain control of the process

Much like selling your home via the Multiple Listing Service, you want to create an "auction" environment where several prospective buyers compete to buy your business. A good M&A professional will get that done. Do not allow a seemingly benevolent, but unsolicited buyer initiate a purchase of your business. You will lose control of the process, fail to create competition, and ultimately leave money on the table.

Hire an advisor

While owners are good at running their businesses, few are proficient in M&A. Already with a full-time job, owners attempting to handle an exit on their own subject the company to lower earnings, declining value and missed aspects of the deal. Your advisor will assemble and coordinate a "success team" to achieve your goals from the transaction, allowing you, the business owner, to focus on what you do best - running your company.

Establish goals

Most business owners have an inflated view of their business value, creating a gap between their expectation and reality. A long-term exit plan can embrace the owner's goals, acknowledge the gap, and establish long-term processes necessary to increase the business value up to or in excess of the owner's expectations.

Identify weaknesses

Weaknesses can include over-reliance on a customer, a supplier, or the sole decision making of the business owner (i.e. - no middle management). These weaknesses will be found out by the buyer's due diligence team. Identify these weaknesses in advance and correct them before taking the business to market. Material weaknesses may take months or even years to correct.

Complete due diligence in advance

Once a prospective buyer is chosen, the buyer's due diligence begins. If this process takes more than 60-90 days, the deal may begin to unravel and die, wasting time and money. Our patented software (see below) is intended to accomplish 90% or more of due diligence before taking the business to market.

Prepare for life after the sale

Exiting your business is an emotional journey. Business owners frequently encounter depression after ceding control of the business they created and ran perhaps for decades. The owner should determine in advance what life after the transaction will look like, avoiding regret or seller's remorse.

In everything we do, we believe in improving the lives of business owners. We believe each owner is unique and important to our society. The way we improve their lives is by understanding their goals and by removing any barriers that get in their way. And we happen to have unique talent, tools and processes.

B2B CFO^® provides Strategic Business Advisory Services to owners of privately held companies. We focus on increasing cash and company value. By redefining the way that these services are provided, we have created a new industry, which we dominate and lead. With a nationwide presence, B2B CFO^® is the largest company of its kind in this industry. Founded in 1987, we have ranked four times in the Inc. 5000 and were recognized as one of Forbes Magazine's "Small Giants." Over the decades, we have published books and created numerous resources, including an award-winning and patented software. For more information about how we help business owners excel, please visit www.B2BCFO.com.