Many business owners are so busy with the day-to-day management of their business that business exit/retirement is the last thing on their minds, says John Niekraszewicz.
Have you started thinking about your business exit strategy?
Many business owners are so busy with the day-to-day management of their business that business exit/retirement is the last thing on their minds.
The reality is, everyone plans to retire or leave their business at some point.
Like owning your own home, owning your own business is probably one of the most expensive investments you’ve made.
Over the years, you’ve worked hard to maintain your home—you’ve done some major improvements like updating the kitchen and the floors.
When you’re ready to sell, one of the first steps you take is looking at your house from the buyer’s point of view. What will it take to make it attractive?
It’s easy, there may be a bit of work to be done like repainting, fixing some leaky faucets, cleaning the carpets, reducing the clutter.
The bottom line is to maximize the value so you can financially benefit. Just like when you are ready to exit your business, the goal is to leave it in the best possible shape so that you and your family will benefit from all those years of hard work.
So, how do you begin to prepare your business to make it attractive to potential buyers? For starters, you know the company cannot survive unless it is staffed with the most qualified people.
Potential buyers want to ensure there is a stable, experienced management structure in place. These key people are employees whose role or skills are necessary to the continued success of the company. Recruiting good people is one of the key pieces in succession planning.
How do you attract and retain motivated, qualified people who will help to increase the value of your business?
One way is to offer a flexible, properly designed compensation plan. A Group RRSP is the vehicle. It is one of the least expensive benefits an employer can provide.
Group plans are available for companies as small as three employees to as large as 1,000 employees.
Other benefits employers can expect include increased productivity, reduced tax liability, greater ease in attracting and retaining key employees, minimized benefit cost, easy administration and ability to remain competitive.
Taking care of your most valuable asset now will reap rewards down the road.
John Niekraszewicz (Nick-ra-shev-itch) is a Certified Financial Planner and president of JVK Life & Wealth Advisory Group. For a reprint of this article in newsletter format, call 1-800-767-5933 or email@example.com