Creating Successful Transitions
On average, most owners only exit a business once in their lifetime. It is often a new experience with a series of decisions that can greatly alter the outcome.
What are your best choices when it comes to transitioning your business? Is it to merge upward, sell to an external buyer, conduct a family succession or perhaps sell to employees? Let us help evaluate your options.
Dorfman Abrams Music Can Provide a Transition Blueprint:
- Initiate a Structured Process to Begin a Plan
- Help You Target an Exit Date
- Acquire Independent, Objective Professionals to Help
- Identify Factors to Maximize the Sales Value or Succession Strategy
- Plan the Post-Sale Tax Impact
Time is a Valuable Tool in Exit Planning
In general, the shorter the planning time-frame, the less profitable the sale may become. Time enables you to refine operations to maximize value and ensure key-person and non-competes are in place. It also allows owners to remove themselves as much as possible from the day-to-day operations and provides time to let a tax strategy unfold especially in a family succession if gifting is involved.
How to Begin the Process
- Build a Team of Professionals. Typically, a CPA, attorney, banker and business broker
- Establish a Timeline. This could be 6 months or 10 years
- Take Steps to Enhance Value. Make the business physically and financially attractive to buyers
- Separate Yourself from the Business. The business needs to be viewed as an asset for sale
- Depersonalize Decisions. Remove the emotional connection
- Create a Tax Plan. This could include a retirement strategy, estate & trust needs, life insurance, healthcare, etc.
- Prepare for Post-Exit. Establish an investment strategy for the proceeds