The Baby Boomer generation is rapidly hitting the retirement mark, and this includes 7.7 million business owners representing over $10 trillion in wealth. Yet the majority of business owners don’t have an exit plan or any plan on how to retire or leave their businesses in the future.
Are You Thinking About Retirement?
Waiting to sell might be your default — especially if you are attached to your business or want to wait for top dollar. But having a plan, even years in advance, is a better approach.
Research shows that 83 percent of business owners have no written succession plan. This leaves them open to exiting in one of these five undesirable ways:
- Death
- Disability
- Divorce
- Distress
- Disagreement
When you exit without a plan, you could end up getting too little for your business or paying more in taxes for the transaction. Additionally, failed succession planning will directly affect millions of employees and indirectly harm even more vendors, suppliers, partners, contractors and others who rely on your business to succeed.
If you’re putting off succession decisions because you enjoy what you do and don’t want to quit, we have news for you: Proper exit planning means you can work longer and sell your company for top dollar when the time is right.
It helps to partner with an M&A Advisor skilled in exit planning and succession strategies. Creating a team of advisors that includes your financial advisor, your CPA, your trusted advisors and a firm like DBG Advisors will help you prepare, accelerate value, and ultimately close a business sales transaction.
[/et_pb_text][/et_pb_column][/et_pb_row][/et_pb_section][et_pb_section fb_built=”1″ _builder_version=”4.9.10″ _module_preset=”default”][et_pb_row column_structure=”1_2,1_2″ _builder_version=”4.9.10″ _module_preset=”default”][et_pb_column type=”1_2″ _builder_version=”4.9.10″ _module_preset=”default”][et_pb_text _builder_version=”4.9.10″ _module_preset=”default”]Why Exit Planning is Important
A business exit plan asks and answers a variety of questions that must be considered when exiting a company, such as:
- What happens if the business owners die?
- What happens if the business owners divorce?
- What happens if the business owners retire?
- What happens if the business owners have debt?
- What happens if the business owners leave the business to their family?
Transition plans will also keep in mind tax/estate planning and personal goals (philanthropy, hobbies, legacy).
In the past year, business owners have been exiting in record numbers due to the COVID-19 pandemic and the resulting lifestyle reflection it spurred.
Research is showing that these record exit numbers came after quarantine/lockdown. Some Boomers saw their business erode, some saw gains, others decided to exit to enjoy life and spend more time with their children and grandchildren. Others went into early retirement due to medical reasons.
At the end of 2020, research found a 25 percent drop in Boomers who claimed to be business owners.
And this year, for the first time, more Boomers are retired than working (30.3 million to 29.6 million).
On the other hand, the pandemic knocked down several business owners who were close to retiring, but were forced to rebuild, rehire and reassess exit strategies. If you find yourself in this situation, don’t wait to regain traction — increase valuation proactively with DBG Advisors.
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Common Exit Strategy Plans |
Pros |
Cons |
Sell to family |
|
|
Sell your portion of the business to your partner(s) |
|
|
Sell to your management team via a management buyout or your employees via an Employee Stock Ownership Plan (ESOP) |
|
|
Sell to (or merge with) a strategic acquirer |
|
|
Liquidate |
|
You likely won’t get the biggest return on investment Severing relationships with employees, partners, clients, customers, etc. |
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Hire a Certified Exit Planning Advisor
At DBG Advisors, Nolan Duck is a Certified Exit Planning Advisor (CEPA). Many CEPAs are financial advisors, but Nolan brings valuable expertise as an M&A Advisor and his experience with business valuation.
Business owners and their families throughout Texas trust Nolan with his decades of experience and ethical values. Our offices are in North Dallas and Abilene, but we enjoy traveling to meet with clients in West Texas and the Panhandle.
We also provide a complimentary consultation for new clients, either in person or video conference.
M&A activity in Texas is growing in 2021, and we see signs that buyer demand will be around for some time to come.
If you’re ready to discuss retiring from your Texas-based business, contact us today to get started on an exit plan.
[/et_pb_text][/et_pb_column][/et_pb_row][/et_pb_section][et_pb_section fb_built=”1″ custom_padding_last_edited=”on|tablet” _builder_version=”4.9.10″ background_color=”#efede8″ custom_padding=”60px||60px||false|false” custom_padding_tablet=”0px||0px||true|false” custom_padding_phone=”” global_module=”1907″ saved_tabs=”all”][et_pb_row _builder_version=”4.9.10″ width_tablet=”98%” width_phone=”80%” width_last_edited=”on|phone” custom_padding=”||16px|||”][et_pb_column type=”4_4″ _builder_version=”4.0.5″][et_pb_text _builder_version=”4.9.10″ header_2_text_color=”#2b2b2b” header_3_text_color=”#efede8″ border_width_bottom=”2px” border_color_bottom=”#0d628f”]What Sets DBG Advisors Apart
[/et_pb_text][/et_pb_column][/et_pb_row][et_pb_row column_structure=”1_4,1_4,1_4,1_4″ _builder_version=”4.9.10″ _module_preset=”default”][et_pb_column type=”1_4″ _builder_version=”4.9.2″ _module_preset=”default”][et_pb_blurb title=”Connections” use_icon=”on” font_icon=”%%135%%” icon_color=”#FFFFFF” use_circle=”on” circle_color=”#146391″ _builder_version=”4.9.10″ _module_preset=”default” header_text_align=”center” header_font_size=”25px” body_text_align=”center” body_font_size=”22px”]Connections within the North Texas business community and in larger Texas markets
[/et_pb_blurb][/et_pb_column][et_pb_column type=”1_4″ _builder_version=”4.9.2″ _module_preset=”default”][et_pb_blurb title=”Marketability” use_icon=”on” font_icon=”%%86%%” icon_color=”#FFFFFF” use_circle=”on” circle_color=”#146391″ _builder_version=”4.9.10″ _module_preset=”default” header_text_align=”center” header_font_size=”25px” body_text_align=”center” body_font_size=”22px”]Ability to market Texas businesses to other buyers within larger cities of Texas and even assist in out-of-state mergers and acquisitions
[/et_pb_blurb][/et_pb_column][et_pb_column type=”1_4″ _builder_version=”4.9.2″ _module_preset=”default”][et_pb_blurb title=”Our Specialty” use_icon=”on” font_icon=”%%176%%” icon_color=”#FFFFFF” use_circle=”on” circle_color=”#146391″ _builder_version=”4.9.10″ _module_preset=”default” header_text_align=”center” header_font_size=”25px” body_text_align=”center” body_font_size=”22px”]Specializing in family-owned businesses and small businesses
[/et_pb_blurb][/et_pb_column][et_pb_column type=”1_4″ _builder_version=”4.9.2″ _module_preset=”default”][et_pb_blurb title=”Understanding” use_icon=”on” font_icon=”%%259%%” icon_color=”#FFFFFF” use_circle=”on” circle_color=”#146391″ _builder_version=”4.9.10″ _module_preset=”default” header_text_align=”center” header_font_size=”25px” body_text_align=”center” body_font_size=”22px”]Understanding and responding to the specific reasons you have for selling your Texas business, including as part of an exit plan, looking to retire comfortably, looking to move, selling a business in order to expand and grow, etc.
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