Do you own all or a part of a closely-held business? If so, you will leave your business at some point, whether voluntarily or otherwise, and you need to think ahead. If you want to be in command of the situation, you need to formulate a clear idea of your future needs and goals and develop a strategy to satisfy them. That means creating a business Exit Plan.
A truly cohesive Exit Plan developed by an Exit Strategist, will help you maximize the value you receive from your business, allow you to leave on your terms and will direct the business ownership and other assets to the people you choose and in the manner you choose.
In fact, a real Exit Plan has eight different elements, all of which must be addressed to help you fully achieve your objectives. These elements can be summarized as:
1. The Advisory Team
2. Owner Goals and Objectives
3. The Value of the Business
4. The Purchaser or Transferee
5. Building and Maintaining the Value of the Business
6. Implementing and Monitoring the Exit Plan
7. The Business Contingency Plan; and
8. The Personal and Family Plan.
A true Exit Plan is based on a comprehensive process tailored to your particular goals and situation. It is a process that makes an often complex set of issues manageable and resolvable. The Exit Plan will help to identify and resolve people planning, corporate management and tax issues, as well as financial situations in conflict with your goals.
For example, you may want to transfer the business to a family member or to a key employee instead of to a third party. This kind of transaction often presents significant risk to you and can cause cash flow problems. The Exit Planning process will help you to identify if you can afford to do this, how you can accomplish it, what the potential pitfalls may be and how they can best be addressed.
In all events, your Exit Strategist can help you to decide what transaction makes the most sense for you and your company and then to position yourself and your company to make that transaction work.
For further information regarding these matters, please contact Ms. Umphrey at 248.619.2591 or [email protected]
Cynthia Umphrey helps families and business owners make significant personal and professional life decisions. Ms. Umphrey calls upon over 10 years of experience in estate planning, probate administration, business structuring and business exit planning to guide you though life's most important choices.