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| Getting The Value Out (Con't) By John Dunlavey |
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But in an informal survey of business owners who were quitting, not a single owner said, "it's time to
maximize my value." Most said that they were bored or burned out. Other reasons cited were lack of sufficient
capital, lack of liquidity, the kids not showing enough ability or interest in the business, advancing
age and poor health. In order to maximize value the shop owner or jobber needs: 1. A personal financial strategy 2. Estate planning 3. Business planning 4. Management succession planning 5. Ownership transition planning In order to accomplish this, he/she wants to have: 1. An understanding of his/her situation and choices 2. Access to information so he/she can make the right decisions 3. A relationship with a team of advisors who are both skilled and trustworthy 4. Convenience 5. Privacy--he/she has no wish for relatives or employees, suppliers, banks, customers or competitors to know his/her financial affairs. They may be difficult for us to work with because they feel ignorant, suspicious of new advisors, skeptical of new ideas, intimidated and at personal risk of losing it all. They are likely to procrastinate. Therefore it is no wonder that many of today's business owners will not get their full value when they decide to hang it up. The fundamental changes taking place in our economy today are being seen by some family business owners as a chance to grow, and by others as a wake-up call to pass the torch or even close down. It is an intensely personal decision, but the question must always be answered: "Will I get my value back?" You should regularly ask yourself: 1. Who will own the company when I step aside? 2. Who will run it? 3. Are 1. and 2. the same person? 4. Have I prepared the way with the proper incentives? 5. Have I protected it all from the devastation of the estate process? 6. Are my insurance agent, attorney and accountant working together as a team for me? |
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