Why an Exit Plan is Important
In one way or another, all business owners will eventually exit their businesses. For this reason, business owners should have an exit plan to maximize the value of their businesses in order to fit their future plans and to select a successor. It is important for business owners to begin the process early to identify and enhance key drivers that increase transferrable value.
Why Focus on Value?
The majority of a business owner’s net worth is often comprised of the value of the business. Preserving value enables owners to achieve financial goals inside and outside their business.
Focusing on value makes the timing of an owner’s exit less important because the business is always ready for ownership transition when the current owner is ready to step aside. Connecting daily activities to value acts as a driver of organizational behavior, mitigates risk, engages employees and management to think more like business owners, and can be used as a tool for inter-generational and employee development, transition, and measurement.
What is Value Acceleration?
Value acceleration is a business strategy that focuses on value growth, while aligning business, personal, and financial goals. By integrating these three key components into one master plan, the process creates a roadmap to exit-planning success. A well-executed plan will promote the use of teams in an engaging and collaborative process and provide the owner with key deliverables and metrics, ultimately resulting in a significant increase in value.
How Has COVID-19 Affected Your Business Valuation?
As the COVID-19 pandemic subsides, many exit plans will be altered or even postponed for the foreseeable future. This presents a unique opportunity to integrate value acceleration into the exit planning strategy, evaluate and improve past practices, develop teams, and commit to building a more durable, valuable company.
If you have questions or would like more information, please contact Rob Henderson at rhenderson@windes.com or 844.4WINDES
(844.494.6337).
