Click here to learn more about our financial professionals by visiting FINRA's BrokerCheck.

Succession Planning

Begin with the end in mind," says Stephen Covey in his book, "The Seven Habits of Successful Living." Those who have created a successful business know it does not happen without planning, hard work, and a little luck. Yet most have no exit plan for leaving their business. The truth is that most business relationships do not have happy endings. To have a successful business, you must have a customized exit plan in place

What Is Exit Planning

Exit Planning is the deliberate, adaptable, and customized process that a business owner uses so that he (or she) can leave his business on his terms and on his schedule. The process will yield a highly tailored result for each business owner and ensure that all issues are covered.

A complete Exit Plan rests on a 7-step design process. These steps are illustrated in seven simple questions

  • Do you know your exact retirement goals and what it will take -- in cash -- to reach them?
  • Do you know how much your business is worth today, in cash?
  • Do you know the best way to maximize the income stream generated by your ownership interest?
  • Do you know how to sell your business to a third party and pay the least possible taxes?
  • Do you know how to transfer your business to family members, co-owners, or employees while paying the least possible taxes and enjoying maximum financial security?
  • Do you have a continuity plan for your business if the unexpected happens to you?
  • Does your family have financial security if the unexpected happens to you?

The corresponding Exit Planning Steps are

  • Establishing Owner Objectives
  • Establishing Business Value
  • Building Value and Cash Flow
  • Selling to a Third Party for Top Dollar
  • Transferring to Management or Family Members
  • Developing a Contingency Plan for the Business
  • Family Wealth Preservation Planning

Bottom Line Owners face a number of barriers to a successful exit from their businesses:

Most owners don’t know that there is a proven Exit Planning Process

Most business advisors are unaware of all that can be done to assist owners as they begin to plan for their business exits

Without a plan, exiting your business can appear daunting and, as a result, owners wait until it is too late to undertake it